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CMA Intermediate · Financial Management and Business Data Analytics · Comparative, Common-Size Financial Statements and Trend Analysis

In a comparative income statement of Kaveri Traders, sales were ₹8,00,000 in the earlier year and ₹9,20,000 in the current year. What is the percentage change in sales, taking the earlier year as the base?

Sales rose by 15 per cent. The increase of ₹1,20,000 is divided by the earlier-year sales of ₹8,00,000, because comparative statements use the earlier period as the base for computing percentage change.

  1. A13.04% increase
  2. B15% increaseCorrect
  3. C15% decrease
  4. D13.04% decrease

Explanation

Absolute change = 9,20,000 − 8,00,000 = ₹1,20,000. Percentage change = 1,20,000 / 8,00,000 × 100 = 15%. The 13.04% figure arises from wrongly using the current year (9,20,000) as the base.

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