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Computation of Seasonal Indices

Ratio to moving average method

An analyst wants to use the ratio-to-moving average method to forecast a company's sales for the next few quarters. Beginning in Quarter 4 of 2006 , the analyst collects the following sales data (in millions of dollars).
Estimate the seasonal index associated with Quarter 1 . Round your answer to at least three decimal places.

Tme Quarter Sales Moving Average
1 4 113.2

2 1 211
137.5
3 2 132
142.4
4 3 93.8
137.025
5 4 132.8
135.4
6 1 189.5
136.225
7 2 125.5
136.825
8 3 97.1
154.35
9 4 135.2
156.2
10 1 259.6
154.6
11 2 132.9

12 3 90.7

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Solution Summary

In this problem the computation of seasonal indices by using ratio to moving average method is illustrated. The general procedure is described and it is illustrated by using the given problem. The computation is provided in an excel sheet also, so that students can easily use it.

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