Frequency calculations are used throughout financial analysis, statistics, and other mathematical representations to determine how often an event has occurred. Determining the frequency of financial events in a transaction list can assist in determining the popularity of an item or product, the future likelihood of an event to reoccur, or frequency of profitability of an organization. Excel, however, does not create histograms by default.
In this recipe, you will learn how to use several functions including bar charts and FREQUENCY functions to create a histogram frequency chart within Excel to determine profitability of an entity.
When plotting histogram frequency, we are using frequency and charting to determine the continued likelihood of an event from past data visually. Past data can be flexible in terms of what we are trying to determine; in this instance, we will use the daily net profit (Sale income Versus Gross expenses...