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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA TX-UK Exams › Issues in computing indexation allowance
Hi, when I am trying the BBP practice kit questions I found out a issue in computation.
For example:
Question 162 involves in indexation allowance, the answer compute it as below:
Indexation allowance
(263.0-215.1)/215.1X£8000=£1781
Although I used the same equation to compute, I firstly got the result of the part
(263.0-215.1)/215.1=0.223
which makes the indexation allowance £1784
Therefore different from the standard answer.
So which method should I use in exam?
Thanks.
When re-indexing the share pool you do NOT round to a 3 dp indexation factor – hence your difference