Assignment

Group 4: Forecasting

NAÏVE METHOD

PROBLEM:

A restaurant is forecasting sales of chickens for the month of April. Total sales of chickens for march
were 480. if management uses the naïve method to forecast, what is their forecast for the next month
of April?

Simple Mean or Average

PROBLEM

Annie’s Secret Garden is forecasting sales for its classic food product, Waldorf salad. Waldorf salad sales
have been steady, and the restaurant uses a simple mean to forecast. Weekly sales over the past five
weeks are available. Use the mean to make a forecast for 6 weeks.

Time Period Actual Sales Forecast

(in weeks)

1 53

2 52

3 50

4 54

5 51

6 - 52.0
Simple Moving Average

Problem:

Maria’s Italian restaurant sales department, forecast for a food product are made using a three-period
moving average. Given the following figures for January, February and March. Make a forecast for April.

Month Actual Sales Forecasting Three-

period MA

January 300

February 200

March 300

Five-period MA

Problem:

Maria’s Italian Restaurant, sales deartment forecast for a food product are made using a five-period
moving average. Given the following figures. Forecast for June, July, August, and September are
computed as follows:

Note: ACTUAL SALES LANG KUKUNIN DITO FOR FIVE-PERIOD MOVING AVERAGE TO GET THE FORECAST.

MONTH ACTUAL SALES FORECAST THREE-

PERIOD MOVING
AVERAGE

January 300 -

February 200 -

March 300 -

April 400

May 350 300

 June 500 350

July 650 416.6

August 600 500

September - 583.3

WEIGHTED MOVING AVERAGE

Problem:

A manager at Giant Burgers Co. wants to forecast sales of chicken burgers for August using the three-
period weighted moving average. Sales for May, June and July are as follows:

MONTH ACTUAL SALES FORECAST

MAY 500

JUNE 600

JULY 700

The Manager decided to weight May (0.30), June (0.30) and July (0.60)

EXPONENTIAL SMOOTHING

Problem:

The Hot Tamale Mexican restaurant uses exponential smoothing to forecast monthly

tabasco sauce. Its forecast for September was 250 bottles, whereas actual usage in

September was 320 bottles. If the restaurant’s managers use an 0.70, what is their

forecast for October?

 TREND ADJUSTED EXPONENTIAL SMOOTHING

Problem:

Golden Creamery Corporation uses exponential smoothing with trend to forecast monthly usage of its
creamery products. At the end of July the company wishes to forecast sales for August. The trend
through June has been 20 additional gallons of product sold per month. Average sale have been 60
gallons per month. The demand for July was 65 gallons. The company uses a = 0.20 and ß = 0.10. make a
forecast including tre nd for the month of August.

NOTE: GET ALL THE NEEDED DATA FIRST

LINEAR TREND

Problem:

A food manufacturer has plotted product sales over the past four weeks. Use a linear line to
generate a forecast for week 5.

WEEKS SALES X² XY

X Y

1 2,400 1 2,400

2 2,500 4 5.000

3 2,400 9 7,200

4 2,600 16 10,400

TOTAL : 10 9,900 30 25,000

Ӯ = 2,375 X = 2.5
FORECASTING SEASONALITY/SEASONAL INDEX

Problem:

Culinary School of Arts wants to develop forecasts for next year’s quarterly enrollment. It has collected
quarterly enrollments for the past two years. It has also forecast total annual enrollment for next year to
be 90,000 students. What is the forecast for each quarter of next year?

QUARTER YEAR 1 YEAR 2

Fall 25 28

Winter 23 26

Spring 19 20

Summer 17 18

TOTAL 84 92