Hello,
I don't understand why the previous year is taken into account in the calculation of the profits after the elimination of the product category. Shouldn't I consider:
- the new revenues: 501.5 M
- calculate the new % in terms of product segmentation?
Thanks
Hi Enrico,
Fair question.
However, the only reason you know new revenues is 501.5M is because you used the previous year numbers.
What i mean is, the previous year's revenue was 590. When you take out products under 5 euro (which make up 15% of revenues), you get 501.5M (590 times .85).
So, by considering 501.5M you are, in of itself, using the previous year numbers
