BigBox Ltd is a medium sized firm that manufactures boxes. The firm is busy with sales forecasting for 2019. Over the past four years, the company has mostly seen substantial growth. The management of the firm wants to get an idea of what sales they can expect over the coming year. They are of the opinion that the firm will continue to grow steadily as it regularly gets stable government contracts. Over the past five years, it sales were as follows:

BigBox Ltd. sales 2013 – 2018 (R’000’s):

2013  2015   2016   2017  2018

42      55       62       78      86

At the moment, there is a discontinuity between management and the accountant of the firm. The management have been basing their estimations in the average growth per year, which, according to the accountant has been found to be inaccurate. The management tasked you to come up with a better, but objective, estimation of sales for 2019.

Required:

Evaluate the past sales and use regression analysis using your HP10BII+ calculator or any other suitable tool, to create a very brief report and estimation as required. Discuss:

 How the regression was done 

 The slope of the regression 

 Forecasted sales for 2018 

Answer rating: 100% (QA)

The regression equation was done by using the HP10BII calculator The slope ... View the full answer