# Inputs, Calculations and Outputs

Understanding how to manage inputs, perform calculations, and generate outputs is critical for building effective financial models in Lucid Dreams. This guide will walk you through the steps and provide a tutorial on creating new calculations. ## Steps to Creating a Model ### Step 1 - Setup * Go to the Models Section * Navigate to the Models tab on your Lucid Dreams dashboard. * Click on "Add New Model" to start a new financial model.

### Step 2 - Defining Your Inputs * Inputs are the foundational data points for your model, such as projections, growth rates, costs, and other financial metrics. * Examples of inputs include revenue projections, cost assumptions, and operational expenses.

### Step - Performing Calculations * Lucid Dreams will use the defined inputs to perform calculations and generate outputs. * Calculations link inputs to create meaningful financial metrics, such as total revenue, operating profit, and net margin.

### Step 4 - Connect Outputs to Financial Reports * The outputs generated from your calculations can be connected to your financial reports. * This integration helps you see the impact of different scenarios and assumptions on your overall financials. * Inputs lead to calculated outputs, which then integrate into your broader financial analysis.

### Tutorial on Creating Calculations Creating calculations in Lucid Dreams is straightforward. Here's how you can do it. #### Add a New Calculation * In your model, navigate to the Calculations section and click "Add a calculation."

* Enter the formula you need. For example, if you want to calculate gross profit, you might use a formula like \`Revenue - Cost of Goods Sold\`.

## Value Types Lucid Dreams supports different value types for calculations: * Date: Useful for time-based calculations. * Number: For general numerical values. * Currency: Specifically for financial values. * Boolean: True/False values. * Percentage (%): For rates and ratios.

### Example Calculation * Suppose you want to calculate Gross Profit. You might define it as: * Gross Profit = Revenue - Cost of Goods Sold * Enter this formula in the calculation section.

### Adjusting Date * If you change the date rate, but keep the formula the same, the calculated value will remain constant, provided the underlying inputs don’t change.

### Renaming and Managing Calculations * You can rename your calculations for clarity. * Manage your calculations by editing or deleting them as needed.

## Practical Example Let’s say you want to create a model to forecast your company’s Q4 performance. Here’s a step-by-step example: ### 1. Go to Models Section * Click "Add New Model" and name it "Q4 Forecast."

#### 2. Define Inputs * Revenue Projection: $500,000 * Cost of Goods Sold: $200,000 * Operating Expenses: $150,000

### 3. Create Calculations * Add a calculation for Gross Profit: \`Gross Profit = Revenue - Cost of Goods Sold * Another for Net Income: \`Net Income = Gross Profit - Operating Expenses\`

### 4. Connect Outputs * Link your Revenue as Income output, Cost of Goods Sold as Cost of Goods Sold, and Operating Expenses as Expense to your financial report to see the overall impact on your company's financial health.

By following these steps, you can effectively use Lucid Dreams to manage inputs, perform calculations, and generate insightful outputs that enhance your financial planning and decision-making processes.
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