Tuesday

December 1, 2015
Posted by **Anonymous** on Sunday, April 25, 2010 at 5:10pm.

Human Service Agency for the past four fiscal years:

20X1 $15,000,000

20X2 $14,250,000

20X3 $14,000,000

20X4 $13,500,000

Forecast total revenues for fiscal year 20X5 using moving averages, weighted moving

averages, exponential smoothing, and time series regression. For moving averages

and weighted moving averages, use only the data for the past three fiscal

years. For weighted moving averages, assign a value of 1 to the data for 20X2, a

value of 2 to the data for 20X3, and a value of 3 to the data for 20X4. For exponential

smoothing, assume that the last forecast for fiscal year 20X4 was $13,000,000.

You decide on the alpha to be used for exponential smoothing. For time series

regression, use the data for all four fiscal years. Which forecast will you use? Why?

Forecasting 131

Financial Management for Human Service Administrators, by Lawrence L. Martin. Copyright © 2001 by Allyn and Bacon, a Pearson Education Company.

ISBN: 0-

- accounting -
**kish kish**, Sunday, December 12, 2010 at 3:24pmE X E R C I S E S

Exercise 9.1

The following data represent total personnel expenses for the Palmdale Human

Service Agency for past four fiscal years:

20X1 $5,250,000

20X2 $5,500,000

20X3 $6,000,000

20X4 $6,750,000

Forecast personnel expenses for fiscal year 20X5 using moving averages, weighted

moving averages, exponential smoothing, and time series regression. For moving

averages and weighted moving averages, use only the data for the past three fiscal

years. For weighted moving averages, assign a value of 1 to the data for 20X2, a

value of 2 to the data for 20X3, and a value of 3 to the data for 20X4. For exponential

smoothing, assume that the last forecast for fiscal year 20X4 was $6,300,000.

You decide on the alpha to be used for exponential smoothing. For time series

regression, use the data for all four fiscal years. Which forecast will you use? Why?

Moving averages

Fiscal Year Expenses

20X2 $5,500,000

20X3 $6,000,000

20X4 $6,750,000

20X5 $6,083,333

To get the moving average, we add the last three years then divide by 3 to get the forecasted expenses for fiscal year 20X5.

Weighted moving averages

Fiscal Year Expenses Weight Weight Score

20X2 $5,500,000 1 $5,500,000

20X3 $6,000,000 2 $12,000,000

20X4 $6,750,000 3 $20,250,000

20X5 $6,291,667

To get weighted moving average for fiscal year 20X5, we add weight to the expenses to get a weight score. We then add the weight score and divide by number of weight added all together, to get fiscal year expenses for 20X5.

Exponential smoothing

Fiscal Year Expenses

20X2 $5,500,000

20X3 $6,000,000

20X4 $6,750,000

20X5 $6,210,000

Exponential smoothing uses the formula NF = LF + a (LD - LF) to calculate a forecast.

NF=$6,300,000+.3($6,000,000-$6,300,000)

Haven't figured out time seriers yet

- accounting -
**Anonymous**, Saturday, June 4, 2011 at 3:01amHow do financial tren impact forecasting