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Accounting Statements and Forecasting: Micro Chip Computer Corporation


(Use this link above to answer the following questions)

Click here for selected financial statements for Micro Chip Computer Corporation. Answer questions 1 and 2 below based on the financial data.

1. Determine the year-to-year percentage annual growth in total net sales.

2. Based only on your answers to question #1, do you think the company will hit its sales goal of +10% annual revenue growth in 2005? Determine the target revenue figure, and explain why you do or do not feel that the company can hit this target.


(Use this link to answer these next two questions)

Next, consider Micro Chip's Consolidated Statement of Operations for the year ended September 25, 2004 (click here to download) and answer questions 1 and 2.

1. Use the Percentage Sales Method and a 20% increase in sales to forecast Apples' Consolidated Statement of Operations for the period September 26, 2004 through September 25, 2005. Assume a 15% tax rate and restructuring costs of 2% of the new sales figure.

2. Discuss your results from question number #1. What assumptions have you made? Do any of your assumptions seem unreasonable?

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Solution Summary

The solution prepares the financial statements of Micro Chip Computer Corporation for different scenarios using the percentage sales method. Answer attached as an Excel spreadsheet.