Forecasting Monthly Expenditures Using Normal Distribution in Excel

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SUMMARY

The discussion focuses on forecasting future monthly expenditures for a construction project using normal distribution in Excel 2003. The provided expenditure data spans from July 2008 to June 2009, with a total allocated budget of $12 million. A participant suggests that the costs may not follow a normal distribution and recommends using linear regression instead. This indicates a preference for a more statistically robust method for forecasting expenditures.

PREREQUISITES
  • Understanding of normal distribution and its application in Excel 2003
  • Familiarity with linear regression analysis techniques
  • Basic knowledge of Excel functions for statistical analysis
  • Ability to interpret financial data and forecasts
NEXT STEPS
  • Research how to implement linear regression in Excel 2003
  • Learn about the limitations of normal distribution for financial forecasting
  • Explore Excel functions such as FORECAST and LINEST for predictive analysis
  • Investigate alternative forecasting methods beyond normal distribution
USEFUL FOR

Financial analysts, project managers, and anyone involved in budgeting and forecasting expenditures in construction projects.

physics911
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Hi, everyone,

I have a quick question for normal distribution in Excel.

There's a construction project with the following monthly expenditures:

JUL 2008 $ 4,903
AUG 2008 $ 3,591
SEP 2008 $ 15,452
OCT 2008 $ 12,806
NOV 2008 $ 59,988
DEC 2008 $ 121,808
JAN 2009 $ 261,162
FEB 2009 $ 264,769
MAR 2009 $ 306,240
APR 2009 $ 438,695
MAY 2009 $ 397,569
JUN 2009 $ 345,190


The project's allocated amount is $12 million and the time period is from July 2008 to December 2010. Is there anyway I can forecast future monthly expenditures (from July 2009 & onwards) based on normal distribution model using Excel 2003?

Your input is greatly appreciated.

Thank you.

Physics911
 
Physics news on Phys.org
Do those costs look normally distrubuted to you?

I think you'd do better to approach it from a linear regression point of view.BTW. This looks like homework. Is it?
 

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