Question
Use Segment Disclosures to Forecast Revenue Following are 2017 and 2018 revenue data for Honeywell Internationals four segments. Use these data to forecast its 2019
Use Segment Disclosures to Forecast Revenue
Following are 2017 and 2018 revenue data for Honeywell Internationals four segments. Use these data to forecast its 2019 revenue.
Note: Complete the entire question using the following Excel template: Excel Template. Then enter the answers into the provided spaces below with two decimal places.
| Honeywell International Segment Sales and Business-Unit Sales by Segment | ||
|---|---|---|
| $ millions | 2018 | 2017 |
| Aerospace sales | ||
| Commercial aviation original equipment | $3,571 | $2,475 |
| Commercial aviation aftermarket | 5,373 | 5,841 |
| Defense and space | 5,403 | 4,053 |
| Transportation systems | 2,622 | 3,886 |
| Total aerospace sales | $16,969 | $16,255 |
| Honeywell building technologies sales | ||
| Homes | $4,666 | $4,482 |
| Buildings | 5,370 | 6,033 |
| Total Honeywell building technologies sales | $10,036 | $10,515 |
| Performance materials and technologies sales | ||
| UOP Russell LLP | $3,583 | $2,753 |
| Process solutions | 4,981 | 5,533 |
| Advanced materials | 3,586 | 2,791 |
| Total performance materials and technologies sales | $12,150 | $11,077 |
| Safety and productivity solutions sales | ||
| Safety | $2,278 | $2,907 |
| Productivity solutions | 4,797 | 3,470 |
| Total safety and productivity solutions sales | $7,075 | $6,377 |
| Total consolidated sales | $46,230 | $44,224 |
a. Calculate historic (year-on-year) sales growth for each business unit, segment, and total consolidated sales. Note: Complete the entire question in Excel (template provided above). Using Excel, format each answer to two decimal places. Use Increase Decimal or Decrease Decimal to adjust decimal places. Do not round answers. Then enter the answers into the provided spaces below with _two decimal places_. Note: Use negative signs with answers, when appropriate.
| Honeywell International Segment Sales and Business-Unit Sales by Segment | 2017 to 2018 | |
|---|---|---|
| $ millions | % growth | |
| Aerospace sales | ||
| Commercial aviation original equipment | Answer
| |
| Commercial aviation aftermarket | Answer
| |
| Defense and space | Answer
| |
| Transportation systems | Answer
| |
| Total aerospace sales | Answer
| |
| Honeywell building technologies sales | ||
| Homes | Answer
| |
| Buildings | Answer
| |
| Total Honeywell building technologies sales | Answer
| |
| Performance materials and technologies sales | ||
| UOP Russell LLP | Answer
| |
| Process solutions | Answer
| |
| Advanced materials | Answer
| |
| Total performance materials and technologies sales | Answer
| |
| Safety and productivity solutions sales | ||
| Safety | Answer
| |
| Productivity solutions | Answer
| |
| Total safety and productivity solutions sales | Answer
| |
| Total consolidated sales | Answer
|
b. Use the historic growth in Total consolidated sales (from 2017 to 2018) calculated in Part a to estimate total consolidated sales for 2019.
| Estimated total consolidated sales for 2019 | Answer
|
c. Refine the sales forecast by using the sales growth rates for each of the four segments (from 2017 to 2018) calculated in part a to estimate 2019 sales for each segment. Determine a forecast for total consolidated sales for 2019.
| Estimated total consolidated sales for 2019 | Answer
|
d. Refine the sales forecast further by using the sales growth rates for each of the business units within each of the four segments. This means we use the separate historic growth for each line item in the table (calculated in part a) to estimate 2019 total consolidated sales.
| Estimated total consolidated sales for 2019 | Answer
|
e. Which approach do we believe is more accurate in forecasting total consolidated sales? AnswerPart bPart cPart d
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Fundamental Accounting Principles Volume 2
Authors: Kermit Larson, Heidi Dieckmann
15th Canadian Edition
1259087360, 9781259087363
