FORECAST Function (Functions in Excel)
Month | Sales |
1 | £1,000 |
2 | £2,000 |
3 | £2,500 |
4 | £3,500 |
5 | £3,800 |
6 | £4,000 |
Type the month number to predict : | 12 | |
The Forecast sales figure is : | £7,997 | =FORECAST(E11,F4:F9,E4:E9) |
What Does It Do ? |
This function uses two sets of values to predict a single value. |
The predicted value is based on the relationship between the two original sets of values. |
If the values are sales figures for months 1 to 6, (Jan to Jun), you can use the function |
to predict what the sales figure will be in any other month. |
The way in which the prediction is calculated is based upon the assumption of a Linear Trend. |
Syntax |
=FORECAST(ItemToForeCast,RangeY,RangeX) |
ItemToForecast is the point in the future, (or past), for which you need the forecast. |
RangeY is the list of values which contain the historical data to be used as the basis |
of the forecast, such as Sales figures. |
RangeX is the intervals used when recording the historical data, such as Month number. |
Formatting |
No special formatting is needed. |
Example |
The following table was used by a company considering expansion of their sales team. |
The Size and Performance of the previous teams over a period of three years were entered. |
The size of the New Sales team is entered. |
The =FORECAST() function is used to calculate the predicted performance for the new sales |
team based upon a linear trend. |
Year | Size Of Sales Team | Known Performance |
1996 | 10 | £5,000 |
1997 | 20 | £8,000 |
1998 | 30 | £8,500 |
Size Of The New Sales Team : | 40 | |
Estimated Forecast Of Performance : | £10,667 | =FORECAST(E43,E39:E41,D39:D41) |
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