Question

1 Approved Answer

Posted on Jul 17, 2024

ALL INFORMATION IS LISTED. Refine Assumptions for PPE Forecast Provided below is FY2016 information for Medtronic PLC. Medtronic plc Consolidated Statement of Income ($ millions)

ALL INFORMATION IS LISTED. image text in transcribed

Refine Assumptions for PPE Forecast Provided below is FY2016 information for Medtronic PLC. Medtronic plc Consolidated Statement of Income ($ millions) Apr. 29, 2016 Net sales $29,277 Costs and expenses Cost of products sold 9,142 Research and development expenses 2,224 Selling, general, and administrative expense 9,469 Special charges (gains), net Restructuring charge, net Certain litigation charges, net Acquisition-related items 283 Amortization of intangiable assets 1,931 Other expense, net Operating profit Interest expense, net 955 Income from operations before income taxes 4,780 Provision for income taxes 908 Net income $3,872 70 290 26 107 5,735 Medtronic plc Consolidated Balance Sheets ($ millions) Apr. 29, 2016 Apr. 24, 2015 Medtronic plc Consolidated Balance Sheets ($ millions) Apr. 29, 2016 Apr. 24, 2015 Current assets Cash and cash equivalents $2.975 $4,942 Investments 9,758 14,637 Accounts receivable 5,562 5,112 Inventories 3,473 3,463 Tax assets 697 1,335 Prepaid expenses and other current assets 1,234 1,454 Total current assets 23,699 30,943 Property, plant, and equipment, net 4,940 4,798 Goodwill 41,500 40,530 Other intangible assets, net 26,899 28,101 Long-term tax assets 1,383 774 Other assets 1,559 1,737 Total assets $99,980 $106,883 Current liabilities Short-term borrowings $1,092 $2,533 Accounts payable 1,709 1,610 Accrued compensation 1,712 1,611 Accrued income taxes 566 935 Deferred tax liabilities 119 Other accrued expenses 2.185 2,464 Total current liabilities 7,264 9,272 Long-term debt 30,247 33,752 Long-term accrued compensation 1,759 1,535 Long-term accrued income taxes 2,903 2,476 1,709 1,712 1,610 1,611 935 566 119 2,185 2,464 7,264 9,272 30,247 33,752 1,759 1,535 2,903 Accounts payable Accrued compensation Accrued income taxes Deferred tax liabilities Other accrued expenses Total current liabilities Long-term debt Long-term accrued compensation Long-term accrued income taxes Long-term deferred tax liabilities Other long-term liabilities Total liabilities Shareholders' equity Ordinary shares Retained earnings Accumulated other comprehensive (loss) Total shareholders' equity Total liabilities and shareholders' equity 3,729 2,476 4,700 1,819 53,554 1,916 47,818 54,030 (1,868) 52,162 $99,980 54,513 (1,184) 53,329 $106,883 a. Use the financial statements along with the additional informati CAPEX in FY2016 $1,079 million Depreciation expense in FY2016 923 million Forecasted FY2017 net sales 35,620 million Property, plant, and equipment, gross FY2015 8,863 million Property, plant, and equipment, gross FY2016 9,714 million Depreciation expense in FY2016 923 million Forecasted FY2017 net sales 35,620 million Property, plant, and equipment, gross FY2015 8,863 million Property, plant, and equipment, gross FY2016 9,714 million Round to the nearest million. Forecasted PPE, net for FY2017 $ 0 million b. Suppose the company discloses in a press release that accompanies its year-end SEC filing that anticipated CAPEX for FY2017 is $1.5 billion. Use the guidance to refine your forecast of property, plant and equipment, net for FY2017. $ 0 million Refine Assumptions for PPE Forecast Provided below is FY2016 information for Medtronic PLC. Medtronic plc Consolidated Statement of Income ($ millions) Apr. 29, 2016 Net sales $29,277 Costs and expenses Cost of products sold 9,142 Research and development expenses 2,224 Selling, general, and administrative expense 9,469 Special charges (gains), net Restructuring charge, net Certain litigation charges, net Acquisition-related items 283 Amortization of intangiable assets 1,931 Other expense, net Operating profit Interest expense, net 955 Income from operations before income taxes 4,780 Provision for income taxes 908 Net income $3,872 70 290 26 107 5,735 Medtronic plc Consolidated Balance Sheets ($ millions) Apr. 29, 2016 Apr. 24, 2015 Medtronic plc Consolidated Balance Sheets ($ millions) Apr. 29, 2016 Apr. 24, 2015 Current assets Cash and cash equivalents $2.975 $4,942 Investments 9,758 14,637 Accounts receivable 5,562 5,112 Inventories 3,473 3,463 Tax assets 697 1,335 Prepaid expenses and other current assets 1,234 1,454 Total current assets 23,699 30,943 Property, plant, and equipment, net 4,940 4,798 Goodwill 41,500 40,530 Other intangible assets, net 26,899 28,101 Long-term tax assets 1,383 774 Other assets 1,559 1,737 Total assets $99,980 $106,883 Current liabilities Short-term borrowings $1,092 $2,533 Accounts payable 1,709 1,610 Accrued compensation 1,712 1,611 Accrued income taxes 566 935 Deferred tax liabilities 119 Other accrued expenses 2.185 2,464 Total current liabilities 7,264 9,272 Long-term debt 30,247 33,752 Long-term accrued compensation 1,759 1,535 Long-term accrued income taxes 2,903 2,476 1,709 1,712 1,610 1,611 935 566 119 2,185 2,464 7,264 9,272 30,247 33,752 1,759 1,535 2,903 Accounts payable Accrued compensation Accrued income taxes Deferred tax liabilities Other accrued expenses Total current liabilities Long-term debt Long-term accrued compensation Long-term accrued income taxes Long-term deferred tax liabilities Other long-term liabilities Total liabilities Shareholders' equity Ordinary shares Retained earnings Accumulated other comprehensive (loss) Total shareholders' equity Total liabilities and shareholders' equity 3,729 2,476 4,700 1,819 53,554 1,916 47,818 54,030 (1,868) 52,162 $99,980 54,513 (1,184) 53,329 $106,883 a. Use the financial statements along with the additional informati CAPEX in FY2016 $1,079 million Depreciation expense in FY2016 923 million Forecasted FY2017 net sales 35,620 million Property, plant, and equipment, gross FY2015 8,863 million Property, plant, and equipment, gross FY2016 9,714 million Depreciation expense in FY2016 923 million Forecasted FY2017 net sales 35,620 million Property, plant, and equipment, gross FY2015 8,863 million Property, plant, and equipment, gross FY2016 9,714 million Round to the nearest million. Forecasted PPE, net for FY2017 $ 0 million b. Suppose the company discloses in a press release that accompanies its year-end SEC filing that anticipated CAPEX for FY2017 is $1.5 billion. Use the guidance to refine your forecast of property, plant and equipment, net for FY2017. $ 0 million