Prepare forecasted financial statement with certain assumptions

Kodak: CASE 9-1
INCOME STATEMENT
For Year Ended December 31 (in millions) 20x6 20x5 20x4
Net sales ..................... $13,234 $13,994 $14,089
Cost of goods sold..................... 8,670 8,375 8,086
Gross profit........................... 4,564 5,619 6,003
Selling, general, and administrative expenses................................. 2,781 2,665 2,846
Research and development costs.......... .. 779 784 817
Restructuring costs (credits) and other.......................................659 (44) 350
Earnings from operations .................. 345 2,214 1,990
Interest expense .............. ........... 219 178 142
Other income (charges) ................... (18) 96 261
Earnings before income taxes .............. 108 2,132 2,109
Provision for income taxes...... ........... 32 725 717
Net earnings ........................... $ 76 $ 1,407 $ 1,392

BALANCE SHEET
At December 31 (in millions, except share and 20x6 20x5
Assets
Current assets
Cash and cash equivalents ...................$ 448 $ 246
Receivables, net ........................... 2,337 2,653
Inventories, net............................ 1,137 1,718
Deferred income taxes ........................ 521 575
Other current assets ......................... 240 299
Total current assets ........................ 4,683 5,491
Property, plant, and equipment, net ......................................... 5,659 5,919
Goodwill, net.................................. 948 947
Other long-term assets....................... 2,072 1,855
Total assets......................... ...... $13,362 $14,212
Liabilities and shareholders' equity
Current liabilities
Accounts payable and other current liabilities ................................ $ 3,276 $ 3,403
Short-term borrowings......................... 1,378 2,058
Current portion of long-term debt............................................ 156 148
Accrued income taxes ........................... 544 606
Total current liabilities .................... 5,354 6,215
Long-term debt, net of current portion ...................................... 1,666 1,166
Postemployment liabilities ................... 2,728 2,722
Other long-term liabilities .................... 720 681
Total liabilities ........................... 10,468 10,784
Shareholders' equity
Common stock, $2.50 par value
950,000,000 shares authorized: issued 391,292,760 shares in 20x6 and 20x5;
290,929,701 and 290,484,266 shares outstanding in 20x6 and 20x5 ........................... 978 978
Additional paid in capital...................... 849 871
Retained earnings............................. 7,431 7,869
Accumulated other comprehensive loss ......................................... (597) (482)
8,661 9,236
Treasury stock, at cost; 100,363,059 shares in 20x6 and 100,808,494 shares in 20x5........... (5,767) (5,808)
Total shareholders' equity.....................2,894 ....3,428
Total liabilities and shareholders' equity ..................................... $13,362 $14,212

Questions:

Prepare forecasts of its income statement, balance sheet, and statement of cash flows for 20x7
under the following assumptions:
c. Taxes payable are at the 20x6 level of $544 million.
d. Depreciation expense charged to SG&A is $765 million and $738 million for 20x6 and 20x5, respectively.