Following are revenue and cost of revenue numbers for Thermo Fisher Scientific.

THERMO FISHER SCIENTIFIC INC.
Consolidated Statement of Income
For Year Ended December 31 ($ millions)	2018	2017
Revenues
Product revenues	$18,868	$17,374
Service revenues	5,490	3,544
Total revenues	24,358	20,918
Costs and operating expenses
Product cost of revenues	9,682	8,975
Service cost of revenues	3,819	2,495
Total cost of revenues	13,501	11,470
Selling, general and administrative expenses	6,057	5,504
Research and development expenses	967	887
Restructuring and other costs, net	50	97
Total costs and operating expenses	20,575	17,958
Operating income	3,783	2,960
Other expense, net	(521)	(531)
Income from continuing operations before income taxes	3,262	2,429
Income tax expense	324	201
Income from continuing operations	2,938	2,228
Loss from discontinued operations	0	(3)
Net income	$2,938	$2,225

Required
a. Use the historic growth in total revenues (from 2017 to 2018) to forecast total revenue for 2019. Use the historic rate of total cost of revenues to total revenues to forecast total cost of revenues. Other forecast assumptions follow:

Selling, general and administrative expenses	24.9% of total revenues
Research and development expenses	4.0% of total revenues
Restructuring and other costs, net	$0
Other expense, net	No Change
Income tax expense	23% of pretax income

Rounding instructions:

• Round growth rate factors for revenue accounts to three decimal places (for example, 1.034555 = 1.035) or one decimal place as a percentage (1.034555 = 103.5%).
• Round rate of cost factors to one decimal place, as a percentage (for example, 0.634555 = 63.5%).
• Round your final answers below to the nearest whole dollar.

Thermo Fisher Scientific
Forecasted Income Statement
	Dec. 31, 2019
	Forecast
Product Revenues	Answer
Service Revenues	Answer
Total Revenues	Answer
Total cost of revenue	Answer
Selling, general and administrative expenses	Answer
Research and development expenses	Answer
Restructuring and other costs, net	Answer
Total costs and operating expenses	Answer
Operating Income	Answer
Other Expense, Net	Answer
Income from Continuing Operations Before Income Taxes	Answer
Income tax expense	Answer
Net Income	Answer

b. Refine your forecast by using the separate historic growth in product revenues and service revenues (from 2017 to 2018) to estimate 2019 product and service revenues respectively for 2019. Also, use the historic growth in cost of revenues for each segment to forecast separate segment cost of revenues. Assume other forecast assumptions are as in part a.

Rounding instructions:

• Round growth rate factors for revenue accounts to three decimal places (for example, 1.034555 = 1.035) or one decimal place as a percentage (1.034555 = 103.5%).
• Round rate of cost factors to one decimal place, as a percentage (for example, 0.634555 = 63.5%).
• Round your final answers below to the nearest whole dollar.

Thermo Fisher Scientific
Forecasted Income Statement
	Dec. 31, 2019
	Forecast
Revenues
Product Revenues	Answer
Service Revenues	Answer
Total Revenues	Answer
Product Cost of revenues	Answer
Service Cost of revenues	Answer
Total cost of revenue	Answer
Selling, general and administrative expenses	Answer
Research and development expenses	Answer
Restructuring and other costs, net	Answer
Total costs and operating expenses	Answer
Operating Income	Answer
Other Expense, Net	Answer
Income from Continuing Operations Before Income Taxes	Answer
Income tax expense	Answer
Net Income	Answer

c.
Do the two forecasts differ significantly between part a and b? AnswerYesNo

Which forecasted income statement do we believe is more accurate? AnswerForecast from Part aForecast from Part b