Forecast an Income Statement Seagate Technology reports the following income statement for fiscal 2019. SEGATE TECHNOLOGY PLC Consolidated Statement of Income For Year Ended June 28, 2019, $ millions Revenue $20,780 Cost of revenue 14,916 Product development 1982 Marketing and administrative 906 Amortization of intangibles 46 Restructuring and other, net (44) Total operating expenses 17,806 Income from operations 2,974 Interest income 168 Interest expense (448) Other, net 50 Other expense, net (230) Income before income taxes 2,744 (Benefit) provision for income taxes (1,280) Net income $4,024 Forecast Seagate’s 2020 income statement assuming the following income statement relations ($ millions). Revenue growth 5% Cost of revenue 71.8% of revenue Product development 9.5% of revenue Marketing and administrative 4.4% of revenue Amortization of intangibles No change Restructuring and other, net $0 Interest income No change Interest expense No change Other, net No change Income tax rate 21% Note: Round your answers below to the nearest whole dollar. SEAGATE TECHNOLOGY PLC Forecasted Income Statement For Year Ended $ millions June 2020 Revenue Answer Cost of revenue Answer Product development Answer Marketing and administrative Answer Amortization of intangibles Answer Restructuring and other, net Answer Total operating expenses Answer Income from operations Answer Interest income Answer Interest expense Answer Other, net Answer Other expense, net Answer Income before income taxes Answer (Benefit) provision for income taxes Answer Net income Answer

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 103.2C

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Forecast an Income Statement
Seagate Technology reports the following income statement for fiscal 2019.

SEGATE TECHNOLOGY PLC
Consolidated Statement of Income
For Year Ended June 28, 2019, $ millions
Revenue	$20,780
Cost of revenue	14,916
Product development	1982
Marketing and administrative	906
Amortization of intangibles	46
Restructuring and other, net	(44)
Total operating expenses	17,806
Income from operations	2,974
Interest income	168
Interest expense	(448)
Other, net	50
Other expense, net	(230)
Income before income taxes	2,744
(Benefit) provision for income taxes	(1,280)
Net income	$4,024

Forecast Seagate’s 2020 income statement assuming the following income statement relations ($ millions).

Revenue growth	5%
Cost of revenue	71.8% of revenue
Product development	9.5% of revenue
Marketing and administrative	4.4% of revenue
Amortization of intangibles	No change
Restructuring and other, net	$0
Interest income	No change
Interest expense	No change
Other, net	No change
Income tax rate	21%

Note: Round your answers below to the nearest whole dollar.

SEAGATE TECHNOLOGY PLC
Forecasted Income Statement
For Year Ended
$ millions	June 2020
Revenue	Answer
Cost of revenue	Answer
Product development	Answer
Marketing and administrative	Answer
Amortization of intangibles	Answer
Restructuring and other, net	Answer
Total operating expenses	Answer
Income from operations	Answer
Interest income	Answer
Interest expense	Answer
Other, net	Answer
Other expense, net	Answer
Income before income taxes	Answer
(Benefit) provision for income taxes	Answer
Net income	Answer

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