12.4 Sales forecast based on external data.
Nelson Heating and Ventilating Company estimates the coming year's sales revenue based on external data. Thecompany's main business is shopping mall construction, and it uses the square footage of each mall as a "yardstick" for many financial statements and projections. The company does business in four Midwest states. Last year, it completed heating and ventilating systems in four shopping malls with an average size of 2,907,000 square feet for sales revenues of $9,654,000. Nelson is the primary contractor for one-third of the new malls in the four-state area. This coming year,15 new malls are under construction with an average size of 4,414,000 square feet. What is Nelson's anticipated sales revenue for the coming year?
Hints: Make sure to round all intermediate calculations to at least five decimal places.
What is Nelson's anticipated sales revenue?
$_____(Round to the nearest dollar.)
Answer : 18,323,397
Calculation :
Nelson will construct = one-third of 15 malls = 5 malls
Per square-feet price = Sales / Total size
= $9,654,000 / (2,907,000 x 4) = $0.83024
Anticipated Sales Rev. = Avg. Size x No. of Malls x Per sq. ft price
= 4,414,000 x 5 x $0.83024
= $18,323,396.80 or 18,323,397
12.4 Sales forecast based on external data. Nelson Heating and Ventilating Company estimates the coming year's...
12.4 Sales forecast based on external data. Nelson Heating and Ventilating Company estimates the coming year's sales revenue based on external data. The company's main business is shopping mall construction, and it uses the square footage of each mall as a "yardstick" for many financial statements and projections. The company does business in four Midwest states. Last year, it completed heating and ventilating systems in four shopping malls with an average size of 2,907,000 square feet for sales revenues of...
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