Question
Analyze, Forecast, and Interpret Income Statement and Balance Sheet Following are the income statement and balance sheet of ADP Inc. Note: Complete the entire question
Analyze, Forecast, and Interpret Income Statement and Balance Sheet
Following are the income statement and balance sheet of ADP Inc.
Note: Complete the entire question using the following Excel template: Excel Template. Then enter the answers into the provided spaces below with two decimal places.
AUTOMATIC DATA PROCESSING INC. | |
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Statement of Consolidated Earnings | |
For Year Ended June 30, 2019, $ millions | |
Total revenues | $13,041.0 |
Operating expenses | 6,574.0 |
Systems development and programming costs | 636.3 |
Depreciation and amortization | 304.4 |
Total cost of revenues | 7,514.7 |
Selling, general, and administrative expenses | 2,819.0 |
Interest expense | 120.0 |
Total expenses | 10,453.7 |
Other (income) expense, net | (102.0) |
Earnings before income taxes | 2,689.3 |
Provision for income taxes | 712.8 |
Net earnings | $1,976.5 |
AUTOMATIC DATA PROCESSING INC. | |
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Balance Sheet | |
$ millions | June 30,2019 |
Current assets | |
Cash and cash equivalents | $1,793.0 |
Accounts receivable, net | 2,439.3 |
Other current assets | 519.6 |
Total current assets before funds held for clients | 4,751.9 |
Funds held for clients | 27,079.0 |
Total current assets | 31,830.9 |
Long-term receivables, net | 23.8 |
Property, plant and equipment, net | 703.0 |
Capitalized contract cost, net | 2,428.5 |
Other assets | 934.4 |
Goodwill | 2,323.0 |
Intangible assets, net | 1,071.5 |
Total assets | $39,315.1 |
Current liabilities | |
Accounts payable | $125.5 |
Accrued expenses and other current liabilities | 1,618.0 |
Accrued payroll and payroll-related expenses | 721.1 |
Dividends payable | 313.0 |
Short-term deferred revenues | 220.7 |
Obligations under reverse repurchase agreements | 262.0 |
Income taxes payable | 54.8 |
Total current liabilities before client funds obligations | 3,315.1 |
Client funds obligations | 26,813.0 |
Total current liabilities | 30,128.1 |
Long-term debt | 2,002.2 |
Other liabilities | 735.0 |
Deferred income taxes | 659.9 |
Long-term deferred revenues | 399.3 |
Total liabilities | 33,924.5 |
Shareholders' equity | |
Preferred stock, $1.00 par value; Authorized, 0.3 shares; issued , none | |
Common stock, $0.10 par value; Authorized, 1,000.0 shares; | |
issued, 638.7 shares; outstanding 434.2 shares | 63.9 |
Capital in excess of par value | 1,173.9 |
Retained earnings | 17,500.6 |
Treasury stock, at cost: 204.5 shares | (13,090.5) |
Accumulated other comprehensive loss | (257.3) |
Total stockholders' equity | 5,390.6 |
Total liabilities and stockholders' equity | $39,315.1 |
Forecast ADPs 2020 income statement and balance sheet using the following relations ($ millions). Note: Complete the entire question in Excel (template provided above). Using Excel, format each answer to two decimal places. Use Increase Decimal or Decrease Decimal to adjust decimal places. Do not round answers. Then enter the answers into the provided spaces below with _two decimal places_. Note: Use negative signs with answers, when appropriate.
Assumptions | ||
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Total revenue growth | 13.00% | growth |
CAPEX as a percentage of total revenue | 1.10% | % of total revenue |
Depreciation | $184.4 | million |
Acquired intangibles as a percentage of total revenue | 2.90% | % of total revenue |
Amortization | $276.1 | million |
Provision for income taxes | 25.00% | % percentage of earnings before income taxes in 2020 |
Taxes payable | 7.70% | % of provision for income taxes in 2020 |
Stock-based compensation | $167.3 | increases Capital in excess of par value by the same amount. Assume that the company routinely includes this form of compensation in operating expenses each year. |
Stock repurchases | $750.0 | million |
Dividends | $1,389.4 | million |
Dividends payable | 26.30% | % of dividends |
Goodwill, long-term debt, preferred stock, common stock, and Accumulated other comprehensive loss | No change in $ amount | |
All other percentages are based on historic percent of total revenues |
AUTOMATIC DATA PROCESSING INC. | ||
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Statement of Consolidated Earnings | ||
For Year Ended June 30, 2020, $ millions | ||
Total revenues | Answer
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Operating expenses | Answer
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Systems development and programming costs | Answer
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Depreciation and amortization | Answer
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Total cost of revenues | Answer
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Selling, general, and administrative expenses | Answer
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Interest expense | Answer
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Total expenses | Answer
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Other (income) expense, net | Answer
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Earnings before income taxes | Answer
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Provision for income taxes | Answer
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Net earnings | Answer
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AUTOMATIC DATA PROCESSING INC. | ||
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Balance Sheet | ||
$ millions | June 30,2020 | |
Current assets | ||
Cash and cash equivalents | Answer
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Accounts receivable, net | Answer
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Other current assets | Answer
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Total current assets before funds held for clients | Answer
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Funds held for clients | Answer
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Total current assets | Answer
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Long-term receivables, net | Answer
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Property, plant and equipment, net | Answer
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Capitalized contract cost, net | Answer
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Other assets | Answer
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Goodwill | Answer
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Intangible assets, net | Answer
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Total assets | Answer
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Current liabilities | ||
Accounts payable | Answer
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Accrued expenses and other current liabilities | Answer
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Accrued payroll and payroll-related expenses | Answer
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Dividends payable | Answer
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Short-term deferred revenues | Answer
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Obligations under reverse repurchase agreements | Answer
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Income taxes payable | Answer
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Total current liabilities before client funds obligations | Answer
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Client funds obligations | Answer
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Total current liabilities | Answer
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Long-term debt | Answer
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Other liabilities | Answer
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Deferred income taxes | Answer
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Long-term deferred revenues | Answer
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Total liabilities | Answer
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Shareholders' equity | ||
Preferred stock, $1.00 par value; Authorized, 0.3 shares; issued , none | Answer
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Common stock, $0.10 par value; Authorized, 1,000.0 shares; | ||
issued, 638.7 shares; outstanding 434.2 shares | Answer
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Capital in excess of par value | Answer
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Retained earnings | Answer
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Treasury stock, at cost: 204.5 shares | Answer
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Accumulated other comprehensive loss | Answer
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Total stockholders' equity | Answer
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Total liabilities and stockholders' equity | Answer
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