Due: by $11$:$59$pm EST on Sunday at the end of Unit # $7$

Final Project$-1{?}^{st}$ Deliverable:

Attached is $2016$ Annual Report for UTX. I want you to review the report but mainly I

want you to focus on pages $10-42$ of the $78$ page report. These area focus on the

MD&A of specific activity within the divisions of UTX, forecasts, and then the

consolidated financial statements. I want you to get comfortable with the statement and

you do not have to memorize it but I want you to review it as you will be using this as a

reference.

$1$st Scenario: The Development of Pro$-$Forma Statements$-$Forecasts

Based upon the MD&A$,$ Income Statement, Balance Sheet and Cash Flow Statement

from pages $16$ & $37-39$ I want each student to copy the format of the Segment Review

on page $16$ and the Income Statement and Balance Sheet from pages $37-38$ within an

Excel workbook $($a tab for each statement$)$ and account for this scenario in which you

will develop pro$-$forma, or forecasted data, within each statement.

Scenario: Honeywell Corp. has decided that they want to grow and expand but instead

of building a new product division that have decided that it may be cheaper to purchase

a division from their competitor UTX. They have made a tender offer to purchase UTXs

Pratt & Whitney $($P&W$)$ jet engine division that is worth $$14\mathrm{.}9$B in net sales form $2016$

with operating profits of $$1\mathrm{.}5B$ and operating gross margin of $10\mathrm{.}4\%.$

The tender offer has been made that consists of $$20B$ that is made of $$15B$ cash

and $$5B$ stock.

Within the income statement and balance sheet I want each student to forecast

out to $2018$ a $3\%$ increase in all categories within each statement. This means

that for Net Income from continuing operations the $2017$ number will be $$5,559B$

and the Net $($loss$)$ would be $$(10\mathrm{.}3).$ Balance sheet will be Cash and Cash

Equivalents $$7372$ B and A will be $$11825$ B$.$

a$.$ I want each category to be forecasted out by $3\%$ for $2017$ and $3\%$ for $2018$

for all categories within the $\frac{P}{L}$ and Balance Sheet.

b$.$ Choose $5$ financial ratio metrics, any $5$ you have chosen, and then

calculate them based upon the $2017$ & $2018$ Data.

i$.$ You will run a set of $5$ metrics for $2017$ and another for $2018.$

From the sale of P&W I want each student to perform $3$ deliverables:

a$.$ Drop in the sale of $$15B$ in cash and $$5B$ debt in the correct categories

within the $\frac{P}{L}$ and Balance Sheet.

b$.$ Deduct the net sales and operating profits from the Income Statement and

then recalculate $2017$ & $2018$ categories for just the Income Statement

C$.$ Redo the metrics for $2017$ & $2018$ and then compare them from $1.$B

Develop a shorty White Paper on the impacts of the sale of P&W and how it will

affect sales.

a$.$ Use your metrics and the changes in them for example.

i$.$ This does not must be more than $1$ page that you can embed within

your workbook.

Thus, this $1^{st}$ part of the project will have multiple tabs within a workbook and for each

scenario I want to see a new tab and please clearly label each tab for each scenario

and on the headers for all your papers.

Students: Be sure to read the criteria, by which your paper$/$project will be

evaluated, before you write, and again after you write.