Microsoft Excel 1D: Financial Projections: Formulas and Formatting

Projections:

• In business you often need to project (or guess) what numbers will be in the future.
• In the example below columns F and G are predicted numbers for next year.
• Of course you don't know what the sales will be for next year, however you can guess or project what they will be based on 10% in the example below (shown in cell C1).
• The amount of Hardware sales for the next year will be $100,000 + ($100,000 X 10%) = $110,000
• The amount of $110,000.00 will appear where the A is in the red square below.
• Calculate what the Software Sales will be for the next year, (B in the red square below), as you will need to answer this in the review questions later, (do it as above) $50,000 + ($50,000 X 10%) = B
• Calculate the Gross Sales using the same method (C in the red square below).
• When working in business, you should always be able to compute projections such as these, with or without a spreadsheet (you probably learned this in elementary school, however many people forget such simple but essential financial math).

Figure 1D1

Formulas (and review of basic math):

• The formula that will appear in A in the red square above is =D9 + (D9 X C1)
• Whether you are calculating manually, using a calculator or using a spreadsheet the following rule will help you to remember the calculation.
• projected number = old number + (old number X percent)
• You can use this rule in many different circumstances.

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