Excel formula question?

Question

cell a1=$20000 = original cost
cell a2=$2500 = working capital
cell a3=a2/(a1-a2) or $2500/(20000-2500) or 14.29% working capital
I want to put a formula into excel to figure out the working capital $ ($2500 in this example) when all I know is the % I want and the original cost. So basically working the ? backwards. I cannot figure out the formula in excel. I know how to figure out the % but I can't work it the other way to figure out the working capital $ amount when I know a %. Can anyone help?

Answer 1

You have a relationship between 3 values. You can specify any two and get the third one.

Just write algebraic equations: I'll use your cell designations:

a3=a2/(a1-a2)

for you example, you've given a1,a2 and get a3

Now , if you're given a3, you need one other valuel

given -> get
a1,a2 -> a3
...
You imply that you're given the percent working capital and the original cost. So,
a3(a1-a2) = a2
a3a1 - a3a2 = a2
a2a1 = a2(1+a3)
a1 = a2(1+a3)/a2
sounds like the equation that you want.

Don't forget to convert percents into decimals,
divide by 100 and drop the '%' sign: 14% = 0.14

Answer 2

a3=a2/(a1-a2)
a3a1-a3a2=a2
Solve for a2,
a2=a3a1/(1-a3), where a3 is the %, and a1 is the original cost.