Answer to Question #167415 in Accounting for Jichang

Question

Problem 4.

A room operation had an average room rate of P480.00 in the first year, P440.00 in year two, and P530.00 in year three. You are to establish an index trend starting with the average room rate for first year and determine the index trend numbers for year two and year three.

Answer 1

Index trend Number. 1st Year. 2nd year. 3rd year

Averaged room rate. P480. P440. P530

Trend Analysis 100%. P440/P480=91.66%. P530/P440=120.45%