Revenue and Income Taxes
Marla JacksonWeek 3 IP Assignment
August 4, 2012
Part 1
Determine the year to year percentage annual growth in total net sales.
a. 2005-2004/2004=
11,933-11,062/11,062=
871/11,062= 0.0787 = 7.9% growth
b. 2006-2005/2005=
9,181-11,933/11,933=
-2752/11,933= -0.2306 = -23% no growth c. 2007-2006/2006= 6,141-9,181/9,181 -3,040/9,181= 0.3311 = -33.1% no growth d. 2008-2007/2007= 8,334-6,141/6,141= 2,193/6,141= 0.3571 = 35.71% growth
Based only on your answers to question #1, do you think the company achieved its sales goal of +10% annual revenue growth in 2009? Determine the target revenue figure, and explain why you do or do not feel that the company hit its target.
Yes, in 2009 the company tripled their goal of 10% annual growth. Pass years they where under 10% annual growth. In 2009 the company achieved a growth of 35.71% therefore making its target.
Part 2
1. Use the Percentage Sales Method and a 20% increase in sales to forecast Micro Chip's Consolidated Statement of Operations for the period of September 26, 2008 through September 25, 2009. Assume a 15% tax rate and restructuring costs of 2% of the new sales figure.
Micro Chip Computer Corporation
Consolidated Statements of Operations For the period September 26, 2007 through
September 25, 2008 Sales | $8,334.00 | Cost of Sales | $5,458.00 | Gross Margin | $2,876.00 | Operating expenses: | R & D | $525.00 | Selling, General, and Administrative | $691.00 | In‐process R & D | ‐‐‐‐‐‐‐‐‐ | Restructuring costs | ‐‐‐‐‐‐‐‐‐ | Total Operating Exp | $1,216.00 | Operating income | $1,660.00 | Total interest and other Income net | $194.00 | Income before provision for Income taxes | $1,854.00 | Provision for income Taxes (15%) | $278.10 | Net income | $1,575.90 |
September 25, 2009
August 4, 2012
Part 1
Determine the year to year percentage annual growth in total net sales.
a. 2005-2004/2004=
11,933-11,062/11,062=
871/11,062= 0.0787 = 7.9% growth
b. 2006-2005/2005=
9,181-11,933/11,933=
-2752/11,933= -0.2306 = -23% no growth c. 2007-2006/2006= 6,141-9,181/9,181 -3,040/9,181= 0.3311 = -33.1% no growth d. 2008-2007/2007= 8,334-6,141/6,141= 2,193/6,141= 0.3571 = 35.71% growth
Based only on your answers to question #1, do you think the company achieved its sales goal of +10% annual revenue growth in 2009? Determine the target revenue figure, and explain why you do or do not feel that the company hit its target.
Yes, in 2009 the company tripled their goal of 10% annual growth. Pass years they where under 10% annual growth. In 2009 the company achieved a growth of 35.71% therefore making its target.
Part 2
1. Use the Percentage Sales Method and a 20% increase in sales to forecast Micro Chip's Consolidated Statement of Operations for the period of September 26, 2008 through September 25, 2009. Assume a 15% tax rate and restructuring costs of 2% of the new sales figure.
Micro Chip Computer Corporation
Consolidated Statements of Operations For the period September 26, 2007 through
September 25, 2008 Sales | $8,334.00 | Cost of Sales | $5,458.00 | Gross Margin | $2,876.00 | Operating expenses: | R & D | $525.00 | Selling, General, and Administrative | $691.00 | In‐process R & D | ‐‐‐‐‐‐‐‐‐ | Restructuring costs | ‐‐‐‐‐‐‐‐‐ | Total Operating Exp | $1,216.00 | Operating income | $1,660.00 | Total interest and other Income net | $194.00 | Income before provision for Income taxes | $1,854.00 | Provision for income Taxes (15%) | $278.10 | Net income | $1,575.90 |
September 25, 2009