FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Global Corp. expects sales to grow by 8% next year. Using the percent of sales method and the data provided in the given tables 9. forecast:
a. Costs except depreciation
b. Depreciation
c. Net income
d. Cash
e. Accounts receivable
f. Inventory
g. Property, plant, and equipment
h. Accounts payable
(Note: Interest expense will not change with a change in sales. Tax rate is 25%.)
The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career.
a. Costs except depreciation
The forecasted costs except depreciation will be S million. (Round to one decimal place and enter all numbers as a positive.)
b. Depreciation
The forecasted depreciation will be S million. (Round to one decimal place and enter all numbers as a positive.)
c. Net income
The forecasted net income will be s million. (Round to one decimal place.)
d. Cash
The forecasted cash will be S million. (Round to one decimal place.)
e. Accounts receivable
The forecasted accounts receivable will be S million. (Round to one decimal place.)
f. Inventory
The forecasted inventory will be S million. (Round to one decimal place.)
g. Property, plant, and equipment
The forecasted property, plant, and equipment will be $ million. (Round to one decimal place.)
h. Accounts payable
The forecasted accounts payable will be $
million. (Round to one decimal place.)
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Transcribed Image Text:Global Corp. expects sales to grow by 8% next year. Using the percent of sales method and the data provided in the given tables 9. forecast: a. Costs except depreciation b. Depreciation c. Net income d. Cash e. Accounts receivable f. Inventory g. Property, plant, and equipment h. Accounts payable (Note: Interest expense will not change with a change in sales. Tax rate is 25%.) The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career. a. Costs except depreciation The forecasted costs except depreciation will be S million. (Round to one decimal place and enter all numbers as a positive.) b. Depreciation The forecasted depreciation will be S million. (Round to one decimal place and enter all numbers as a positive.) c. Net income The forecasted net income will be s million. (Round to one decimal place.) d. Cash The forecasted cash will be S million. (Round to one decimal place.) e. Accounts receivable The forecasted accounts receivable will be S million. (Round to one decimal place.) f. Inventory The forecasted inventory will be S million. (Round to one decimal place.) g. Property, plant, and equipment The forecasted property, plant, and equipment will be $ million. (Round to one decimal place.) h. Accounts payable The forecasted accounts payable will be $ million. (Round to one decimal place.)
Income Statement ($ million)
Balance Sheet ($ million)
Net Sales
185.9
Assets
Costs Except Depreciation
- 175.1
Cash
23.8
EBITDA
10.8
Accounts Receivable
17.8
Depreciation and Amortization
EBIT
- 1.2
Inventories
15.4
9.6
Total Current Assets
57.0
Interest Income (expense)
- 1.9
Net Property, Plant, and
Equipment
113.1
7.7
- 1.9
Pre-tax Income
Total Assets
170.1
Taxes (25%)
-
Liabilities and Equity
Accounts Payable
Long-Term Debt
Net Income
5.8
35.1
112.1
Total Liabilities
147.2
Total Stockholders' Equity
Total Liabilities and Equity
22.9
170.1
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Transcribed Image Text:Income Statement ($ million) Balance Sheet ($ million) Net Sales 185.9 Assets Costs Except Depreciation - 175.1 Cash 23.8 EBITDA 10.8 Accounts Receivable 17.8 Depreciation and Amortization EBIT - 1.2 Inventories 15.4 9.6 Total Current Assets 57.0 Interest Income (expense) - 1.9 Net Property, Plant, and Equipment 113.1 7.7 - 1.9 Pre-tax Income Total Assets 170.1 Taxes (25%) - Liabilities and Equity Accounts Payable Long-Term Debt Net Income 5.8 35.1 112.1 Total Liabilities 147.2 Total Stockholders' Equity Total Liabilities and Equity 22.9 170.1
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