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"Using What-If Analysis" Accountants are counted on to provide management with analyzing data to determine best-...

"Using What-If Analysis"

Accountants are counted on to provide management with analyzing data to determine best- and worst-case scenarios. As future planning becomes more complex, these what-if analyses can increase in complexity and usefulness. Identify and discuss at least three (3) types of what-if analyses that an accountant should be able to perform to measure a firm’s performance over a period. Be sure to include the type of data that will be needed to support this analysis.  Justify your response.

Business   Accounting   
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Three kinds of What-If Analysis tools come with Excel: Scenarios, Goal Seek, and Data Tables. Scenarios and Data tables take sets of input values and determine possible results.  Goal Seek is a process of calculating a value by performing what-if analysis on a given set of values. For our purposes, Excel's Goal Seek feature lets you adjust a value used in a formula to achieve a specific goal.

What if Analysis helps to make better and more informed decisions by changing assumptions and observing or estimating the results, you are also better able to predict the outcome of your decisions.

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