Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Forecast Income Statement and Balance Sheet Following are the income statement and balance sheet for Medtronic PLC. Consolidated Statement of Income, 12 Months Ended ($

Forecast Income Statement and Balance Sheet

Following are the income statement and balance sheet for Medtronic PLC.

Consolidated Statement of Income, 12 Months Ended ($ millions) April 26, 2019
Net Sales $30,557
Costs and expenses
Cost of products sold 9,155
Research and development expense 2,330
Selling, general, and administrative expense 10,418
Amortization of intangible assets 1,764
Restructuring charges, net 198
Certain litigation charges 166
Other operating expense, net 258
Operating profit 6,268
Other nonoperating income, net 373
Interest expense 1,444
Income before income taxes 5,197
Income tax provision 547
Net income 4,650
Net income attributable to noncontrolling interests 19
Net income attributable to Medtronic $ 4,631

Consolidated Balance Sheet ($ millions) April 26, 2019
Current assets
Cash and cash equivalents $ 4,393
Investments 5,455
Accounts receivable, less allowances of $190 6,222
Inventories, net 3,753
Other current assets 2,144
Total current assets 21,967
Property, plant, and equipment, net 4,675
Goodwill 39,959
Other intangible assets, net 20,560
Tax assets 1,519
Other assets 1,014
Total assets $89,694
Current liabilities
Current debt obligations $838
Accounts payable 1,953
Accrued compensation 2,189
Accrued income taxes 567
Other accrued expenses 2,925
Total current liabilities 8,472
Long-term debt 24,486
Accrued compensation and retirement benefits 1,651
Accrued income taxes 2,838
Deferred tax liabilities 1,278
Other liabilities 757
Total liabilities 39,482
Shareholders' equity
Ordinary shares 0
Additional paid-in capital 26,532
Retained earnings 26,270
Accumulated other comprehensive loss (2,711)
Total shareholders' equity 50,091
Noncontrolling interests 121
Total equity 50,212
Total liabilities and shareholders' equity $89,694

Use the following assumptions to prepare a forecast of the companys income statement for fiscal year 2020.

Net sales increase 8%
Cost of product sold 30.0% of net sales
Research and development expense 7.6% of net sales
Selling, general, and administrative expense 34.1% of net sales
Amortization of intangible assets 5.8% of net sales
Restructuring charges, net 75% of 2019 expense
Certain litigation charges $150 million
Other operating expense, net No change
Interest expense No change
Income tax provision 15% of pre-tax income
Income to noncontrolling interests No change

  • Round answers to the nearest whole number.
  • Do not use negative signs with any of your answers.
Consolidated Statement of Income, 12 Months Ended ($ millions) April 2020
Net Sales Answer
Costs and expenses
Cost of products sold Answer
Research and development expense Answer
Selling, general, and administrative expense Answer
Amortization of intangible assets Answer
Restructuring charges, net Answer
Certain litigation charges Answer
Other operating expense, net Answer
Operating profit Answer
Other nonoperating income, net Answer
Interest expense Answer
Income before income taxes Answer
Income tax provision Answer
Net income Answer
Net income attributable to noncontrolling interests Answer
Net income attributable to Medtronic Answer

Use the following assumptions to prepare a forecast of the companys balance sheet for fiscal year 2020.

Accounts receivable, less allowances 20.4% of net sales
Inventories, net 12.3% of net sales
Other current assets 7% of net sales
Goodwill No change
Tax assets 5% of net sales
Other assets 3.3% of net sales
Accounts payable 6.4% of net sales
Accrued compensation (current liability) 7.2% of net sales
Accrued income taxes (current liability) 1.9% of net sales
Accrued income taxes (noncurrent liability) 9.3% of net sales
Other accrued expenses 9.6% of net sales
Accrued compensation and retirement benefits (noncurrent liability) No change
Deferred tax liabilities 4.2% of net sales
Other liabilities 2.5% of net sales
Ordinary shares No change
Accumulated other comprehensive loss No change
Net income attributable to noncontrolling interest $19 million
Dividends in FY2020 $2,853 million
CAPEX in FY2019, forecast CAPEX at historic % of net sales $1,134 million
Depreciation expense in FY2020 $950 million
Amortization expense in FY2020 $1,914 million
Debt due in FY2020 $838 million
Debt due in FY2021 $2,058 million
  • Round answers to the nearest whole number.
  • Use a negative sign with your Accumulated other comprehensive loss answer.
Consolidated Balance Sheet ($ millions) April 2020
Current assets
Cash and cash equivalents Answer
Investments Answer
Accounts receivable, less allowances of $190 Answer
Inventories, net Answer
Other current assets Answer
Total current assets Answer
Property, plant, and equipment, net Answer
Goodwill Answer
Other intangible assets, net Answer
Tax assets Answer
Other assets Answer
Total assets Answer
Current liabilities
Current debt obligations Answer
Accounts payable Answer
Accrued compensation Answer
Accrued income taxes Answer
Other accrued expenses Answer
Total current liabilities Answer
Long-term debt Answer
Accrued compensation and retirement benefits Answer
Accrued income taxes Answer
Deferred tax liabilities Answer
Other liabilities Answer
Total liabilities Answer
Shareholders' equity
Ordinary shares Answer
Additional paid-in capital Answer
Retained earnings Answer
Accumulated other comprehensive loss Answer
Total shareholders' equity Answer
Noncontrolling interests Answer
Total equity Answer
Total liabilities and shareholders' equity Answer

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Connect For Payroll Accounting 2020

Authors: Jeanette Landin

6th Edition

1260943895, 9781260943894

More Books

Students also viewed these Accounting questions

Question

Describe effectiveness of reading at night?

Answered: 1 week ago

Question

find all matrices A (a) A = 13 (b) A + A = 213

Answered: 1 week ago

Question

4 What are the main practices associated with SHRM?

Answered: 1 week ago