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Sales growth/percentage of sales method

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See attached file.

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

Based only on your answers to question #1, do you think the company acheived its sales goal of +10% annual revenue growth in 2009? Determine the target revenue figure, and explain why you do or do not feel that the company hit its target.

Next, consider Micro Chip's Consolidated Statement of Operations for the year ended September 25, 2008.

Use the Percentage Sales Method and a 20% increase in sales to forecast Micro Chip's Consolidated Statement of Operations for the period of September 26, 2007 through September 25, 2008. Assume a 15% tax rate and restructuring costs of 2% of the new sales figure.

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 explains how to determine the sales growth and prepare a proforma income statement using percentage of sales method

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