1. Forecast the June 30, 2017 income statement and balance sheet for Pinnacle, Inc. by performing the steps listed below. Assume the following: 1) Sales revenue in FY 2017 equals $797.3359; 2) the tax rate is 35%; 3) Net Fixed Assets increases to $300; 4) Total Short-Term Investments, Short-Term and Current Portion of Long-Term Debt, Common Stock: Par Value, Common Stock: Additional Paid-In Capital, and Treasury Stock remain constant between fiscal 2016 and 2017; and (5) the dividend per common share is $0.75.

A. Use the percent of sales method to forecast for fiscal 2017 1) Cost of Goods Sold, Depreciation and Amortization Expense, and SG&A Expense; and 2) Short-Term Receivables, Inventories, and Accounts Payable at June 30, 2017. Base each items forecasted amount on its five-year average percentage of Sales.

B. Use the TREND function and fiscal years 2012 through 2016 to forecast for 2017 Other Income, Other Current Assets, Other Long-Term Assets, Other Current Liabilities, and Other Liabilities.

C. Initially assume that the Long-Term Debt balance does not change between fiscal years 2016 and 2017. Use an Excel formula to calculate Interest Expense for the fiscal year 2017 using the 1) Short-Term Debt and Current Portion of Long-Term Debt balance, and 2) LongTerm Debt balance at June 30, 2017.

D. Use formulas to compute Gross Income, EBIT, Pre-Tax Income, and Net Income.

E. Add Net Income to and subtract dividends from Retained Earnings at the end of fiscal 2016 to calculate Retained Earnings at June 30, 2017.

F. Use formulas to compute Total Current Assets, Total Assets, Total Current Liabilities, Total Liabilities, Total Stockholders Equity, and Total Liabilities and Stockholders Equity at June 30, 2017.

G. Calculate discretionary financing needed (DFN) in 2017. Is this a surplus or deficit?

H. Assume that the DFN will be absorbed by Long-Term Debt and set up an iterative worksheet to eliminate the DFN; use a self-referencing formula in cell C21. Also, include a formula that shows the total amount borrowed to eliminate the DFN, and that changes as cell C31 changes.

Pinnacle, Inc. Income Statement r share items All figures in millions of U.S. Dollar, exce Jun-16 794.202 351.966 442.236 19.353 353.057 89.179 1.618 0.395 87.956 31.319 56.637 Jun-15 754.600 343.437 411.163 19.142 345.229 65.934 5.957 1.206 56.683 19.541 37.142 Jun-13 729.083 330.734 398.349 18.008 337.912 60.437 8.778 1.485 50.174 17.696 32.478 Jun-12 729.373 339.085 390.288 18.581 340.676 49.612 9.020 0.562 41.239 8.455 49.694 Jun-17 797.336 5 Sales 6 Cost of Goods Sold 7 Gross Income 8 Depreciation and Amortization Expense 9 SG&AExpense 10 EBIT (Operating Income) 11 Interest Expense 12 Other Income Net 13 Pretax Income 14 Income Taxes 15 Net Income 16 17 Forecasted 18 19 Assumed Interest Rate on LTD 20 Tax Rate 21 Total Shares Outstanding 22 Dividends per Share 23 24 25 Jun-14 746.659 340.163 406.496 17.930 336.860 69.636 7.540 0.306 62.402 19.471 42.931 5.00% 35.0% 27.746 0.750