Forecast an Income Statement

Following is the income statement for Medtronic PLC for the year ended April 29, 2016.

Consolidated Statements of Income		Apr. 29, 2016
Net sales		$27,722
Costs and expenses
Cost of products sold		8,594
Research and development expense		2,224
Selling, general, and administrative expense		9,469
Special charges (gains), net		70
Restructuring charges, net		290
Certain litigation charges, net		26
Acquisition-related items		283
Amortization of intangible assets		1,931
Other expense, net		107
Operating profit		4,728
Interest expense, net		955
Income from operations before income taxes		3,773
Provision for income taxes		717
Net income		$3,056

Use the following assumptions to prepare a forecast of the company's income statement for FY2017.

Net sales increase				16%
Cost of products sold				31.7% of net sales
Research and development expense				7.7% of net sales
Selling, general, and administrative expense				32.8% of net sales
Special charges (gains), net				$0
Certain litigation charges, net				$0
Restructuring charges, net				75% of 2016 expense
Acquistion-related items				1.0% of net sales
Amortization of intangible assets				No change
Other expense, net and Interest expense, net				No change
Provision for income taxes				20% of pre-tax income

Instructions:

• Round answers to the nearest whole number.

• Use rounded answers for any subsequent computations.

• Do not use negative signs with any of your answers.

Medtronic Inc.
Forecasted Consolidated Statement of Income
in Millions				EST. 2017
Net sales				Answer
Costs and expenses
Cost of products sold				Answer
Research and development expense				Answer
Selling, general, and administrative expense				Answer
Restructuring charges, net				Answer
Acquisition-related items				Answer
Amortization of intangible assets				Answer
Other expense, net				Answer
Operating profit				Answer
Interest expense, net				Answer
Income from operations before income taxes				Answer
Provision for income taxes				Answer
Net income				Answer