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    Question about Apple Computers: Questions on Financial statements

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    The following selected financial statements for Apple Computers have been taken out the company's SEC filings. Answer questions 1 and 2 as follows based on this 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 +20% annual revenue growth in 2000? Determine the target revenue figure, and explain why you do or do not feel that the company can hit this target.
    Next, consider Apple's Consolidated Statement of Operations for the year ended September 25, 1999 as shown below and answer questions 3 and 4.
    3. 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.
    4. Discuss your results from question number #3. What assumptions have you made? Do any of your assumptions seem unreasonable?

    Data: Please see attachment

    Fiscal Years
    (in millions except share and per share amounts) 1999 1998 1997 1996 1995
    Net Sales $ 6,134 $ 5,941 $ 7,081 $ 9,833 $11,062
    Net Income (loss) $ 601 $ 309 $ (1,045) $ (816) $ 424
    Earnings (loss) per common share:
    Basic $ 4.20 $ 2.34 $ (8.29) $ (6.59) $ 3.50
    Diluted $ 3.61 $ 2.10 $ (8.29) $ (6.59) $ 3.45
    Cash Dividends declared per common share $ -- $ -- $ -- $ 0.12 $ 0.48
    Shares used in computing earnings (loss) per share (in thousands):
    Basic 143,157 131,974 126,062 123,734 121,192
    Diluted 174,164 167,917 126,062 123,734 123,047
    Cash, cash equivalents, and short-term investments $ 3,226 $ 2,300 $ 1,459 $ 1,745 $ 952
    Total Assets $ 5,161 $ 4,289 $ 4,233 $ 5,364 $ 6,231
    Long-term Debt $ 300 $ 954 $ 951 $ 949 $ 303
    Shareholder's Equity $ 3,104 $ 1,642 $ 1,200 $ 2,058 $ 2,901

    Consolidated Statements of Operations For the period September 26, 1998 through September 25, 1999
    Sales $6,134
    Cost of Sales 4,438
    Gross Margin 1,696
    Operating expenses:
    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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    Solution Summary

    Answers to questions on Financial statements for Apple Computers:
    1. calculates the year-to-year percentage annual growth in total net sales.
    2. Answers the question : can the company will hit its sales goal of +20% annual revenue growth. Determines the target revenue figure.
    3. Uses the Percentage Sales Method and a 20% increase in sales to forecast Apples' Consolidated Statement of Operations.
    4. Discusses results

    $2.49

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