assuming that changes in the producer rsquo s price index are a satisfactory measure 543821

The balance sheet of Rackett & Ball plc., a U.K.-based sporting goods manufacturer, is presented here. Figures are stated in millions of pounds (?m). During the year, the producer’s price index increased from 100 to 120, averaging.

110.The aggregate current cost of sales, depreciation, and monetary working capital adjustment is assumed to be ?216m. Required: Assuming that changes in the producer’s price index are a satisfactory measure of the change in R&B’s purchasing power, calculate, as best as you can, R&B’s monetary working capital adjustment and its gearing adjustment.