Refine Assumptions for PPE Forecast

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

Medtronic PLC
Consolidated Statement of Income For Fiscal Year Ended
$ millions	April 26, 2019
Net sales	$29,029
Costs and expenses
Cost of products sold	8,697
Research and development expense	2,214
Selling, general, and administrative expense	9,897
Amortization of intangible assets	1,676
Restructuring charges, net	188
Certain litigation charges, net	158
Other operating expense, net	245
Operating profit	5,954
Other nonoperating income, net	(354)
Interest expense	1,372
Income before income taxes	4,936
Income tax provision	520
Net income	4,416
Net income loss attributable to noncontrolling interests	(18)
Net income attributable to Medtronic	$4,398

Medtronic PLC
Consolidated Balance Sheet
$ millions	April 26, 2019
Current assets
Cash and cash equivalents	$4,173
Investments	5,182
Accounts receivable, net	5,911
Inventories, net	3,565
Other current assets	2,037
Total current assets	20,868
Property, plant, and equipment, net	4,441
Goodwill	37,961
Other intangible assets, net	19,532
Tax assets	1,443
Other assets	963
Total assets	$85,208
Current liabilities
Current debt obligations	$796
Accounts payable	1,855
Accrued compensation	2,080
Accrued income taxes	539
Other accrued expenses	2,779
Total current liabilities	8,049
Long-term debt	23,262
Accrued compensation and retirement benefits	1,568
Accrued income taxes	2,696
Deferred tax liabilities	1,214
Other liabilities	719
Total liabilities	37,508
Shareholders equity
Ordinary shares	0
Additional paid-in capital	25,203
Retained earnings	24,957
Accumulated other comprehensive loss	(2,575)
Total shareholders equity	47,585
Noncontrolling interests	115
Total equity	47,700
Total liabilities and equity	$85,208

a. Use the financial statements along with the additional information below to forecast property, plant and equipment, net for fiscal year ended April 2020.

	$ millions	April 27, 2018 Actual	April 26, 2019 Actual	April 2020 Forecast
	Net sales	$28,455	$29,029	$33,002
	CAPEX	1,015	1,134
	Depreciation expense	780	895
	Property, plant, and equipment, gross	9,746	10,920
	Property, plant, and equipment, net

b. Suppose the company discloses in a press release that accompanies its year-end SEC filing that anticipated CAPEX for fiscal year ended April 2020 is as follows.

Company anticipated CAPEX for fiscal year ended April 2020

$1,425

million

Use this guidance to refine your forecast of property, plant and equipment, net for fiscal year ended April 2020.

Property, plant, and equipment, net

million