To annualize sales for the remainder of the year based on YTD sales, you can use the formula you mentioned:
YTD Sales + ((YTD Sales/# whole months passed) (# whole months remaining in year)).
Here are the steps to follow:
- Determine the number of whole months that have passed in the year so far. For example, if it is currently August, then 7 whole months have passed.
- Calculate the average monthly sales for the months that have passed by dividing the YTD sales by the number of whole months passed. For example, if the YTD sales are $70,000 and 7 whole months have passed, then the average monthly sales would be $10,000 ($70,000/7).
- Determine the number of whole months remaining in the year. For example, if it is currently August, then there are 5 whole months remaining.
- Multiply the average monthly sales by the number of whole months remaining in the year. For example, if the average monthly sales are $10,000 and there are 5 whole months remaining, then the estimated sales for the remainder of the year would be $50,000.
- Add the YTD sales to the estimated sales for the remainder of the year to get the annualized sales figure. For example, if the YTD sales are $70,000 and the estimated sales for the remainder of the year are $50,000, then the annualized sales figure would be $120,000.
Remember to update the YTD sales figure and repeat these steps each month as sales managers update their YTD sales to actual for the prior month end.