Please do work on excel.

Sales Cost of Goods Sold Gross Income Research & Development Other SG&A Depreciation Expense Other Operating Expense EBIT (Operating Income) Nonoperating Income - Net Interest Expense Unusual Expense - Net Pretax Income Income Taxes Net Income NVIDIA Corporation Income Statement ($ in Millions) For the Years 2012 to 2017 Jan-18* Jan-17 Jan-16 Jan-15 6,910 5,010 4,682 2,648 2,002 1,862 4,906 4,262 3,008 2,820 1,463 1,331 1,360 641 532 443 187 197 220 2 0 0 2,135 1,969 948 796 50 43 42 58 47 46 56 201 37 1,905 743 755 239 129 124 1,666 614 631 Jan-14 4,130 1,623 2,507 1,336 436 239 0 496 24 10 0 510 70 440 Jan-13 4,280 1,828 2,453 1,147 431 226 0 648 17 3 0 662 100 563 Jan-12 3,998 1,743 2,255 984 398 204 0 669 7 3 9 663 82 581 Dividends per Share Tax Rate 0.43 17.35% 0.31 13.77% 0.08 15.03% 0.00 12.41% 0.49 12.55% * Forecast Interest Rate FactSet 2018 Revenue Forecast FactSet 2018 Tax Rate Forecast FactSet 2018 R&D Forecast Sales Multiplier for Scenarios DFN for Scenarios Source: FactSet Fundamentals, Retrieved 15 July 2017 0.40 17.36% 0.34 16.46% NVIDIA Corporation Balance Sheet ($ in Millions) For the Years 2012 to 2017 Jan-18* Jan-17 Jan-16 Assets Cash & Short-Term Investments Short-Term Investments Accounts Receivable Inventories Other Current Assets Total Current Assets Gross Plant & Equipment Accumulated Depreciation Net Plant & Equipment Other Assets Total Assets Liabilities & Shareholders' Equity ST Debt & Current Portion LT Debt Accounts Payable Other Current Liabilities Total Current Liabilities Long-Term Debt Other Liabilities Total Liabilities Common Equity Total Liabilities & Shareholders' Equity Shares Outstanding Discretionary Financing Needed Accumulated DFN Iteration Source: FactSet Fundamentals Jan-15 Jan-14 1,766 5,032 826 794 118 8,536 1,191 670 521 784 9,841 596 4,441 505 418 93 6,053 1,100 634 466 851 7,370 497 4,127 474 483 133 5,713 1,179 622 557 931 7,201 1,151 3,521 426 388 139 5,625 1,283 700 583 1,043 7,251 800.0 485.0 503.0 1,788.0 2,020 271 4,079 5,762 9,841 1,413.0 296.0 642.0 2,351.0 97 453 2,901 4,469 7,370 0.0 293.2 602.8 896.0 1,398 489 2,783 4,418 7,201 2.9 324.4 621.1 948.4 1,371 475 2,794 4,456 7,251 649 569 563.07 594.52 Surplus or Deficit? Jan-13 Jan-12 431 3,297 454 420 173 4,775 1,289 713 576 1,061 6,412 253 2,876 336 340 99 3,905 1,157 596 560 1,087 5,553 0.0 356.4 619.8 976.2 19 589 1,585 4,828 6,412 0.0 335.1 594.9 930.0 21 456 1,407 4,146 5,553 624.96 616.37 HW5-2 NVIDIA Corp. financial statements are presented below. Analysts forecast that its 2018 sales will be $8,260. The expected 2018 tax rate will be 17.35%. Assume the firm pays 5% interest on short-term debt and 7% on long term debt. NVIDIA Corporation Income Statement ($ in Millions) For the Years 2012 NVIDIA to 2017 Corporation Jan-17 Jan-16Balance Jan-15 Jan-13 Jan-12 Sheet ($Jan-14 in Millions) Sales 6,910 5,010For the 4,682 4,130 3,998 Years 2012 to 2017 4,280 Cost of Goods Sold 2,648 2,002 1,862 Jan-17 1,623 Jan-16 1,828 Jan-151,743Jan-14 Gross Income 4,262 3,008 2,820 2,507 2,453 2,255 Assets Research & Development 1,463 1,331 1,360 1,336 1,147 Cash 1,766 596 497 984 1,151 Other SG&A 641 532 443 436 431 Short-Term Investments 5,032 4,441 4,127 398 3,521 Depreciation Expense 187 197 220826 239 505 226 474 204 426 Accounts Receivable Other Operating Expense 2 0 0794 0 418 0 483 0 388 Inventories EBIT (Operating Income) 1,969 948 796118 496 93 648 133 669 139 Other Current Assets Nonoperating Income - Net 50 43 42 246,053 17 5,713 7 5,625 Total Current Assets 8,536 Interest Expense 58 47 46 10 3 3 1,283 Gross Plant & Equipment 1,191 1,100 1,179 Unusual ExpenseDepreciation - Net 56 201 37670 0 634 0 622 9 700 Accumulated Pretax Income 1,905 743 755 510 662 663 Net Plant & Equipment 521 466 557 583 Income 239 129 124784 70 851 100 931 82 1,043 OtherTaxes Assets NetTotal Income 1,666 614 631 4407,370 563 7,201 581 7,251 Assets 9,841 Liabilities & Shareholders' Equity Dividends per Share 0.49 0.40 0.34 0.31 0.08 0.00 ST Debt & Current Portion LT649.00 Debt 800.0 594.52 1,413.0 624.96 0.0 2.9 Shares Outstanding 569.00 563.07 616.37 Accounts Payable 485.0 296.0 293.2 324.4 Tax Rate 12.55% 17.36% 16.46% 13.77% 15.03% 12.41% Other Current Liabilities 503.0 642.0 602.8 621.1 Total Current Liabilities 1,788.0 2,351.0 896.0 948.4 Long-Term Debt 2,020 97 1,398 1,371 Other Liabilities 271 453 489 475 Total Liabilities 4,079 2,901 2,783 2,794 Common Equity 5,762 4,469 4,418 4,456 Total Liabilities & Shareholders' Equity 9,841 7,370 7,201 7,251 Jan-13 Jan-12 431 3,297 454 420 173 4,775 1,289 713 576 1,061 6,412 253 2,876 336 340 99 3,905 1,157 596 560 1,087 5,553 0.0 356.4 619.8 976.2 19 589 1,585 4,828 6,412 0.0 335.1 594.9 930.0 21 456 1,407 4,146 5,553 a) Use your judgement to forecast the items on the income statement and balance sheet with the percent of sales method. What is the discretionary financing needed in 2018? Is this a surplus or deficit? Assume that the dividends per share will be $0.54 and the number of shares will be the same as in 2017. b) Assume that DFN will be absorbed by long-term debt and that the interest rate is 2.5% of the sum of LTD and short-term debt. Set up an iterative worksheet to eliminate it. c) Interpretation: please describe where you obtained information to develop analyses and interpret the results. Please include your written description in the \"interpretation\" tab. If you do not complete this section with your words or leave the interpretation tab as a blank, you receive 0 point in this HW. 1