Exp22 Excel Ch06 Cumulative Autosales 11 Instructions

Exp22 Excel Ch06 Cumulative Autosales 11 Instructions

You are the finance manager for Grossman Auto Sales. Your company offers in-house financing and as part of your duties you create reports detailing purchase options. You want to create a report to determine the optimal purchase price of a vehicle based on your customer’s budget. You also want to create one- and two-variable data tables to provide detailed payment options based on varying interest rates and down payments.

Steps to Perform:

1. Download and open the file named Exp19_Excel_Ch06_Cumulative_AutoSales.xlsx. Grader has automatically added your last name to the beginning of the filename. Create appropriate range names for Purchase Price (cell C5), Sales Tax (cell C6), Down Payment (cell C7), Months Financed (cell C8), APR (cell C9), Down Payment Amount (cell C12), Amount Financed (cell C13), and Tax Owed (cell C14). Create the range names using the Create from Selection method, using the values in the left column. Edit the existing name range Tax_Owed to display as Tax. Note, Mac users, in the Define Name dialog box, add the new named range, and delete the original one.
2. Apply the range names to the existing formulas and functions in the worksheet. Create a new worksheet labeled Range Names, paste the newly created range name information in cell A1, and then resize the columns as needed for proper display.
3. Use Goal Seek to determine the optimal purchase price to reach a $500 monthly payment with all other variables remaining unchanged. Start in cell E5.
4. Complete the series of substitution values ranging from $20,000 to $75,000 at increments of $5,000 vertically down column E.
5. Apply Comma Style format to the range E5:E16 with two decimal points and preserve the thick bottom border on row 16.
6. Enter references to the Down Payment Amount, Tax Owed, and Monthly Payment (Cells F4, G4, and H4) in the correct location for a one-variable data table. Use range names where indicated. Complete the one-variable data table and format the results with Comma Style with no decimal places.
7. Apply Custom number formats to cells F4:H4 that display the text Down Payment in cell F4, Tax in G4, and Monthly Pmt in cell H4.
8. Bold and center the headings and substitution values. Copy the purchase price substitution values from the one-variable data table and paste the values starting in cell J5. Adjust the width of column J as needed. Type 5000 in cell K4. Complete the series of substitution values from $5,000 to $15,000 at $5,000 increments.
9. Apply Accounting Number Format to the range K4:M4. Enter the reference to the Monthly Payment function in the correct location for a two-variable data table. Complete the two-variable data table and apply Comma Style to the range K5:M16 with no decimal places. Apply a Custom number format to make the formula reference display as the descriptive column heading Purchase Price. Bold the headings in cells J4:M4.
10. Create a scenario named Best Case, using Purchase Price and Months Financed. Enter these values for the scenario: 40000, and 36. Create a second scenario named Worst Case, using the same changing cells. Enter these values for the scenario: 50000, and 72. Create a third scenario named Most Likely, using the same changing cells. Enter these values for the scenario: 45000, and 60.
11. Generate a Scenario Summary report based on Monthly Payment. Be sure to use best practice in formatting the report by deleting Column A:B, Row 1, and the Current Values column.
12. Load the Solver add-in if it is not already loaded. Set the objective to calculate a Monthly Payment of $500.
13. Use Purchase Price and Months Financed as changing variable cells. Set constraints to ensure the Purchase Price is less than or equal to $50,000, greater than or equal to $30,000, and a whole number. Set constraints to ensure months financed are less than or equal to 72, greater than or equal to 24, and a whole number. Solve the problem and save the results. Generate the Answer Report.
14. If you get an internal memory error message, remove Solver as an add-in, close the workbook, open the workbook, add Solver in again, and finish using Solver. Save and close Exp22_Excel_Ch06_Cum_AutoSales.xlsx. Exit Excel. Submit the file as directed.

Sample Paper For Above instruction

In the automotive industry, effective financial analysis is crucial for optimizing automobile sales and financing options. This paper explores the comprehensive process used by a finance manager at Grossman Auto Sales to determine the most advantageous purchase price for customers, leveraging advanced Excel functionalities such as range naming, data tables, scenario management, and Solver optimization.

Initially, the process involves creating named ranges for critical financial variables such as Purchase Price, Sales Tax, Down Payment, Months Financed, APR, Down Payment Amount, Amount Financed, and Tax. Utilizing the Create from Selection method ensures that these ranges are dynamically linked to specific cells, facilitating easier management and formula application across the worksheet. For example, the range name 'Tax' replaces the more cumbersome 'Tax_Owed,' simplifying subsequent calculations.

Following this, the worksheet is enhanced by applying the defined range names to relevant formulas, ensuring consistency and reducing errors. A new worksheet labeled 'Range Names' is then inserted, where all range names are listed and formatted for clarity, enabling easier review and verification of variables used throughout the workbook.

The goal-seeking feature in Excel is employed to fine-tune the Purchase Price, aiming to achieve a target monthly payment of $500. This iterative process adjusts the purchase price while keeping other variables constant, illustrating how Goal Seek can be used for financial planning and customer satisfaction enhancement.

Next, substitution series are built for different purchase prices, ranging from $20,000 to $75,000 in $5,000 increments. These series populate a data table that demonstrates how varying purchase prices impact monthly payments, with proper formatting applied to facilitate readability. The table utilizes the Comma Style format with two decimal points and includes bold, centered headers for clarity.

Furthermore, a one-variable data table explores the relationship between Down Payment and Monthly Payment, with references to named ranges ensuring accuracy. This table provides detailed insights into how increasing or decreasing the down payment affects monthly obligations. Building upon this, a two-variable data table examines the combined influence of Purchase Price and Months Financed, offering a multidimensional view of payment scenarios.

Scenario management is integrated via defined scenarios such as Best Case, Worst Case, and Most Likely. Each scenario alters the Purchase Price and Months Financed variables to simulate different customer situations, allowing the finance manager to quickly assess outcomes and make informed decisions. Using the Scenario Summary report function consolidates these scenarios into a comprehensible format, streamlining comparison.

The use of Solver further refines the analysis by determining the optimal purchase price and financing period to result in a monthly payment of $500. The Solver parameters include constraints ensuring realistic and feasible values, such as purchase prices within specified bounds and integer requirements for certain variables. The generated Answer Report provides detailed insights into the optimal solutions found, supporting decision-making processes.

Overall, these Excel tools and techniques offer a robust framework for financial analysis in auto sales, enabling managers to optimize pricing strategies, create tailored payment plans, and enhance customer satisfaction through precise and flexible planning models.

References

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• Microsoft Support. (2021). Using Goal Seek. Retrieved from https://support.microsoft.com
• Microsoft Support. (2022). Using Data Tables. Retrieved from https://support.microsoft.com
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