Consider Apple's Consolidated Statement of Operations for the year ended September 25, 1999 as shown in the attachment and answer the following problem:
Use the Percentage Sales Method and a 20% increase in sales to forecast Apples' Consolidated Statement of Operations for the period September 26, 1999 through September 25, 2000. Assume a 15% tax rate.© BrainMass Inc. brainmass.com October 24, 2018, 5:38 pm ad1c9bdddf
This question is worded a bit awkwardly, so I'm not surprised that you're confused. But really, it's not too complicated.
<br><br>You're given a set of numbers for Sept 26, 1998 to Sept 25, 1999, and are asked, based on these to figure out what they will be for the next year, given only the information that sales will increase by 20% and the tax rate stays the same.
<br><br>How do you figure this out? Percentage of sales. Basically, if your sales increase by 20%, your expenses will increase proportionally. So you need to figure out what the proportions are.
<br><br>I'm not going to do it for you, but here's what it will look like in the end.
<br><br>...............................................1999.......% of ...
Percentage sales method
Use the Percentage Sales method and a 20% increase in sales to forecast Apples' Consolidated Statement of Operations for the period September 26, 1999 through September 25, 2000. Assume a 15% tax rate and restructuring costs of 1% of the new sales figure.
Consolidated Statements of Operations For the period September 26, 1998 through September 25, 1999
Cost of Sales 4,438
Gross Margin 1,696
R & D 314
Selling, General, and Administrative 996
In-process R & D ---------
Restructuring costs ---------
Total Operating Exp $1,310
Operating income $ 386
Total interest and other Income net 317
Income before provision for Income taxes 703
Provision for income Taxes (15%) 105.4
Net income $ 597.6
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