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What-If & Goalseek Analysis + Generating Two Dimensional Table

1) The document discusses using Excel's Goal Seek tool to calculate the breakeven point from given data. It should check if the calculated breakeven point of 571 units satisfies the data using what-if analysis. 2) It instructs to use Goal Seek to calculate the internal rate of return for an investment. 3) It describes using the Data Tools table option to generate a two-dimensional table examining how cash flow changes when varying the unit price and number of units sold based on the breakeven relationship calculated in part 1.

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Suraj Mishra
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34 views2 pages

What-If & Goalseek Analysis + Generating Two Dimensional Table

1) The document discusses using Excel's Goal Seek tool to calculate the breakeven point from given data. It should check if the calculated breakeven point of 571 units satisfies the data using what-if analysis. 2) It instructs to use Goal Seek to calculate the internal rate of return for an investment. 3) It describes using the Data Tools table option to generate a two-dimensional table examining how cash flow changes when varying the unit price and number of units sold based on the breakeven relationship calculated in part 1.

Uploaded by

Suraj Mishra
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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EXERCISE D

(what-if & goalseek Analysis + Generating Two Dimensional Table)


1) A special case of threshold analysis is the breakeven point, usually defined
as the sales volume atwhich contribution to profit and overhead equals fixed
cost. In the software model, the breakevenpoint is the value for Units Sold
when Net Cash Flow is zero. Using Goal Seek (not shown here),the
breakeven point is found to be 571.
Consider the following data stored in a worksheet:

(a) Calculate Break Even Point for the above data using Goal Seek data tool
of the excel sheet
(b) Check whether the Breakeven point calculated using the Goal Seek tool
satisfies the given data using what-if analysis

2) Using Goal seek calculate IRR for the investment given below:

3) Table option of the Data Tools may be used to generate a two dimensional
table (for ranges of values for two model inputs). Useful for examining
possible relationships and threshold combinations.
Consider the model generated in part (1) of this exercise. Generate a table
using the breakeven relationship to examine how the cash flow changes as
you vary the variables Unit Price & Unit Sold.

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