In this workout an analyst has inputs from historical quality information for business and use this to generate some forecast assumptions for Revenue growth profit margins and working capital. We're required to forecast quarterly and annual revenues and gross profits for fy1 to calculate quarter on quarter Revenue growth and finally to forecast working capital. We're going to start off with forecasting revenues and then calculating quarter on quarter Revenue growth. Now if we scroll down we can have a look at the assumptions that we've been given.

And we can see that we've been given year-on-year Revenue growth assumptions on a quarterly basis and also gross profit margin assumptions. Let's start off by forecasting our revenues.

Now when we do this, we just need to remember that forecasting revenues with a year-on-year growth assumption requires us to take the historical information from the same quarter in the previous year. So I'll grab my assumption first.

And then apply that to q1 revenues from the previous year.

Now that I forecast my q1 revenues, I can copy that formula over to the right for the remaining three quarters.

And to calculate the annual revenues. I just need to sum my four quarters revenues.

The next thing we'll do is calculate quarter and quarter Revenue growth. To calculate quarter on quarter Revenue growth. I simply need to take the current quarters revenues and compare that with the previous quarters revenues. Now for Q2, I can't copy the formula over from the previous quarter because of the layout of this model. So I'm just going to have to rebuild my calculation.

And now I've done that I can copy it to the right. Once we've done this we can see quite how seasonal the business is with Revenue peaking in Q4 and troughing in q1.

Now, let's calculate gross profit. And for this we simply take the margin assumption for each quarter and multiply it by the revenue for each quarter. One thing to note before we do this is that the marginal assumption has contracted in Q4 that's unlikely to be a seasonal effect as revenues actually peaked in this quarter. So this suggests that there is some cost inflation going on and that's why the analyst has forecasted lower margins for that quarter.

That's gross profit for q1. We can then copy that formula to the right for the remaining three quarters.

And for annual gross profit, we just need to sum the four quarters.

Now let's scroll down and have a look at working capital.

Now for working capital, these are forecast using working capital days, but we do need to ensure that our working capital data is calculation reflects the fact that we're using quarterly rather than annual income statements information. However, we also need to know that some quarters have more days than others. It's also worth noting that there is some seasonality in the working capital within this business with working capital and in particular inventory peaking in Q3 and then Crossing in Q4 if we scroll to the right we can also see that the analyst assumptions for the forecasts are based on the actual numbers for the same period in the previous quarter to reflect that seasonality. So let's start off by forecasting trade receivables for this we take the Assumption of 21.3 days.

We're going to multiply this by our revenues. for q1 and then divide that by the number of days in q1.

And that gives us our forecast trade receivables moving on down for infantry and trade payables will need cost of sales as a driver in our forecast and that's just revenues less gross profit. So let's build our forecast for those lines.

Now that we've finished our q1 forecast. We can simply copy these over for Q2 to Q4.

Our annual forecast will then just be linked to our Q4 end balances.

And we've now finished building our quarterly forecasts.