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National Scan, Inc., sells ratio frequency inventory tags. Monthly sales for a 6-month period were as follows: Month: Sales Feb 50 Mar 52 Apr 54 May 54 Jun 59 Jul 65 Use an appropriate forecasting method to prepare forecast Sales. a) The May forecast by using the appropriate forecasting method is ________ (in 4 decimal places). b) The August forecast by using the appropriate forecasting method is ________ (in 4 decimal places). https://www.chegg.com/homework-help/questions-and-answers/national-scan-inc-sells-ratio-frequency-inventory-tags-monthly-sales-6-month-period-follow-q26404244 (Similar Question)

We will use Linear Regression equation using least square method as appropriate forecasting method.
As per above,
Y = a + b.X
Where,
X ( independent variable ) = Serial number of month ( 1 for Feb, 2 for Mar, 3 For April, 4 for May, 5 for June, 6 for July and 7 or Aug)
Y ( Dependent variable ) = Forecasted value of sales
A, B = Constants
We place values of months and sales as provided in the problem in 2 successive columns in excel and apply the formula LINEST ( ) and get following values of A and B :
A= 46.0666
B = 2.7428
Thus , the linear regression equation is :
Y = 46.0666 + 2.7428.X
The May forecast accordingly will be ( Put X = 4 ) = 46.0666 + 2.7428 x 4 = 46.0666 + 10.9712 = 57.0378
The August forecast accordingly will be ( Put Y = 7 ) = 46.0666 + 2.7428 x 7 = 46.0666 + 19.1996 = 65.2662
 
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