Unit 2
Christopher J. White
American InterContinental University

Introduction 1. Use the Percentage Sales Method and a 25% 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 5% of the new sales figure. 2. Discuss your results from question number #1. What assumptions have you made? Do any of your assumptions seem unreasonable?

General
Micro Chip Computer Corporation
Consolidated Statements of Operations For the period September 26, 2008 through September 25, 2009
Sales=$8,334.00
Cost of Sales =$5,458.00
Gross Margin =$2,876.00

Operating R&D
R&D =$525.00
Selling, General, and Administrative =$691.00
In‐process R & D

Restructuring costs

The total operations expense =$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

|Sales |$8,334.00 | | |
|Cost of Sales |$5,458.00 |65.5% |$6,549.60 |
|Gross Margin |$2,876.00 |34.5% |$3,451.20 |
| | | | |
|R&D |$525.00 |6.3% |$630.00 |
|Administrative |$691.00 |8.3% |$829.20 |
|In process R&D | | | |
|Restructuring Expenses | |