Karl has received the 3 year lease to sign for the retail premises
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Karl has received the 3 year lease to sign for the retail premises

Task 5 – CPI indexation

Karl has received the 3 year lease to sign for the retail premises for Karl’s Cafe which states that an increase in the monthly rent will be made on the anniversary of the lease in line with CPI.

The monthly rent on commencement is $1200 + GST.

Using the average CPI of 2.1% calculate the rent payable in year 2 and 3 (hint CPI increase will apply after the first year). Write your answer in the table below:

Year

Rent         (Ex GST)

CPI Increase

New Rent

Add GST

Rent (Incl GST)

1

1200

0

1200

120

1320

2

1200

 

 

 

 

3

 

 

 

 

 
Hint
Accounts and Finance The Consumer Price Index (CPI) refers to a measure that inspects the weighted average of prices of a basket of customer goods and services, for instance, transportation, medical care, and food. It is computed by taking price deviations for each item in the programmed basket of goods and averaging them...
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