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Righetti Homes, a custom home builder in Arizona, is currently offering three models in a newly developed residential neighborhood in Scottsdale. The accompanying Specs worksheet
Righetti Homes, a custom home builder in Arizona, is currently offering three models in a newly developed residential neighborhood in Scottsdale. The accompanying Specs worksheet includes the information about the three models, including selling prices, material costs, labor costs, buyer incentives (percent of the selling price), and average buyer upgrades (percent of the selling price). Righetti Homes plans to build 50 homes in the neighborhood, and it would like to estimate its total sales and profits in the new residential neighborhood. a. Build a spreadsheet model to help Righetti Homes estimate its total sales and profits in the new residential neighborhood. If Righetti Homes builds 10 Model A homes, what are the total sales, costs, and profits for these homes? b. Based on initial market analysis, Righetti Homes projects that it will build 15 model A homes, 25 model B homes, and 20 model C homes. What are the total sales and profits for Righetti Homes for the neighborhood? \begin{tabular}{|l|r|r|r|} \hline & Model A & Model B & \multicolumn{1}{l|}{ Model C } \\ \hline Selling Price & 399,990 & 499,990 & 649,990 \\ \hline Material Costs & 120,000 & 150,000 & 200,000 \\ \hline Labor Costs & 150,000 & 200,000 & 330,000 \\ \hline Buyer Incentives (percent of the selling price) & 3% & 5% & 6% \\ \hline Average Buyer Upgrades (percent of the selling price) & 12% & 10% & 8% \\ \hline \end{tabular}
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