The revenue figure for Beechwood & Co for 20X4 was £286 630.This was 5.3% higher than the figure for 20X3 which itself was 2.8% higher than the 20X2 figure.In 20X2 the operating profit percentage was 16.5%. What was the operating profit of the business in 20X2 (to the nearest £)?

Question

Quizplus · Accepted Answer

We need to calculate the operating profit of Beechwood & Co in 20X2. Let's assume the revenue figure for 20X2 was X.

Revenue figure for 20X3 = 2.8% higher than the 20X2 figure
X + 0.028X = 1.028X

Revenue figure for 20X4 = 5.3% higher than the figure for 20X3
1.028X + 0.053(1.028X) = 1.0832X = £286 630

Therefore, X = £264 262.71 (approx.)

Operating profit percentage in 20X2 = 16.5%
Operating profit in 20X2 = (16.5/100) * £264 262.71 ≈ £43 690

So, the best choice is C.

The Revenue Figure for Beechwood & Co for 20X4 Was