For the following questions use this information from Thomps

For the following questions, use this information from Thompson Corporation’s annual reports:

These data are included in the file Thompson Data.

1) Compute a simple index for the revenue of Thompson. Use 2004 as the base period. What can you conclude about the change in revenue over the period?

2)  Compute a simple index for the revenue of Thompson using the period 2004–06 as the base. What can you conclude about the change in revenue over the period?

3)  Compute a simple index for the number of employees for Thompson. Use 2004 as the base period. What can you conclude about the change in the number of employees over the period?

4)  Compute a simple index for the number of employees for Thompson using the period 2004–06 as the base. What can you conclude about the change in the number of employees over the period?

Do your calculations in Excel

Solution

Thomson data:

1. Simple Index for Revenue with 2004 as base year:

Index=(revenue for current year/revenue for base year)*100

Explanation: From the index, it is clear that the revenue peaked in 2008, since then declining year by year just showing some improment in 2015.

2. Simple Index for Revenue with 2004-06 as base period:

Index=(average revenue for current period/average revenue for base period)*100

Explanation: By looking at the index values, it can be inferred that average revenue has been almost stagnant over all periods.

3. Simple Index for employees with 2004 as base year:

Index=(employees for current year/employees for base year)*100

Explanation: Employee strength has almost remain same all these years.

4. Simple Index for Employees with 2004-06 as base period:

Explanation: Average employee strength has almost remained same except for period 2010-12.