moving averages

Can someone advise on the following, struggling to get my head around moving averages . I had to complete the table below using a 3 point moving average based on the actual monthly sales volumes for the current year. I got this as my answers and it seemed to match the answers I was given.

Sales volume Trend Monthly variation
August 72,100
September 49,600 62,500 -12,900
October 65,800 66,000 -200
November 82,600 69,500 13,100
December 60,100
The monthly variation in October is 200 units.

We were then told the additional information

The selling price per unit has been set at £14.50.
Monthly purchases are estimated to be 30% of the value of the forecast sales.

Using the trend and the monthly variations identified in part (a) complete the table below to forecast the sales volume, sales value and purchase value for January ofthe next financial year.

The book answer was given as below. I don’t understand how they get the forecast trend figure?? I can work out the rest of the information

Forecast trend 76,500
variation 200
sales volume 76,700
forecast sales 1,112,150
forecast purchases 333,645




  • Nia
    Nia Registered Posts: 72 ? ? ?
    Hi Donna

    I've just been covering this in college and have worked through your figures and agree with most of the figures except: for Oct you show the variation as -200 and then below as +200. I agree with the -200.

    ...........S Vol.........Trend.........Var

    Dec - you know the variation is -12,900 and the sales vol is 60,100 so you can work out the trend.

    You then need to work out the average increase in the trend:
    =(last trend - 1st trend)/number of trend movements
    =(73,000 - 62,500)/3

    So Jan trend
    = Dec trend + 3,500
    = 73,000 + 3,500
    = 76,500

    As I think the variation should be -200, I think the sales volume should be 76,300

    Hope I haven't confused you. If I'm wrong maybe someone can correct me!
  • Nikdoug
    Nikdoug Registered Posts: 69 ? ? ?
    I agree with Nia, although my method is slightly different. I would have done:

    (69,500 - 62,500)/2

    (Highest trend value calculated - lowest trend value calculated) divided by number of values less 1

    I am not sure where the monthly variation figure for January came from unless where you wrote
    donnas1977 wrote: »
    The monthly variation in October is 200 units.

    was meant to say "The monthly variation in January is 200 units"??

  • donnas1977
    donnas1977 Registered Posts: 182 ? ? ?
    yes meant to write that the monthly variation in october is 200 units.

    thanks for your replies, I will go and have a go at another example and see if I can get this to work out..
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