1. Armaplex Security Company hired to forecast their revenues and expenses for the next two years....

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1. Armaplex Security Company hired to forecast their revenues and expenses for the next two years. The following information is provided to you related to revenues and expenses: Revenues Inflation Rate GDP Growth Rate 2016 $1.5 million 2017 $1.9 million 2% . 3% 2018 2019 $2.7 million $2.3 million 2.5% 496 3% 5% $100.000 $50,000 $20.000 2020 $1.4 million 2,4% 3% 2021 $1.7 million 1.9% The expected Inflation rate and GDP Growth Rate of 2022 are 2% and 3% respectively. The expected Inflation rate and GDP Growth Rate of 2023 are 1.5% and 4% respectively. 2% Expenses of the company include both fixed and variable expenses. In 2021, the following expenses were recorded: . Salaries and Wages (Commission based) - $150,000 Office Rent Depreciation Expense Delivery Expense (Products) Using the above information calculate the following a) Using the 5-year average growth rate, forecast the revenue and expenses of Armaplex for 2022 and 2023. b) Using the 5-year average real growth rate, forecast the revenue and expenses of Armaplex for 2022 and 2023. c) Which of the two methods do you think is more effective in forecasting and why? (2) 1. Armaplex Security Company hired to forecast their revenues and expenses for the next two years. The following information is provided to you related to revenues and expenses: Revenues Inflation Rate GDP Growth Rate 2016 $1.5 million 2017 $1.9 million 2% . 3% 2018 2019 $2.7 million $2.3 million 2.5% 496 3% 5% $100.000 $50,000 $20.000 2020 $1.4 million 2,4% 3% 2021 $1.7 million 1.9% The expected Inflation rate and GDP Growth Rate of 2022 are 2% and 3% respectively. The expected Inflation rate and GDP Growth Rate of 2023 are 1.5% and 4% respectively. 2% Expenses of the company include both fixed and variable expenses. In 2021, the following expenses were recorded: . Salaries and Wages (Commission based) - $150,000 Office Rent Depreciation Expense Delivery Expense (Products) Using the above information calculate the following a) Using the 5-year average growth rate, forecast the revenue and expenses of Armaplex for 2022 and 2023. b) Using the 5-year average real growth rate, forecast the revenue and expenses of Armaplex for 2022 and 2023. c) Which of the two methods do you think is more effective in forecasting and why? (2)

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Answer When comes to Revenue forecasting It is the process of computing the revenue of your ... View the full answer