Forecast the Balance Sheet Following is the balance sheet for Medtronic PLC for the year ended April 29, 2016. Medtronic plc Consolidated Balance Sheets ($ millions) Apr. 29, 2016 Apr. 24, 2015 Current assets Cash and cash equivalents $2,876 $4,843 Investments 9,758 14,637 Accounts receivable 5,562 5,112 Inventories 3,473 3,463 Tax assets 697 1,335 Prepaid expenses and other current assets 1,234 1,454 Total current assets 23,600 30,844 Property, plant, and equipment, net 4,841 4,699 Goodwill 41,500 40,530 Other intangible assets, net 26,899 28,101 Long-term tax assets 1,383 774 Other assets 1,559 1,737 Total assets $99,782 $106,685 Current liabilities Short-term borrowings $993 $2,434 Accounts payable 1,709 1,610 Accrued compensation 1,712 1,611 Accrued income taxes 566 935 Deferred tax liabilities - 119 Other accrued expenses 2,185 2,464 Total current liabilities 7,165 9,173 Long-term debt 30,247 33,752 Long-term accrued compensation 1,759 1,535 Long-term accrued income taxes 2,903 2,476 Long-term deferred tax liabilities 3,729 4,700 Other long-term liabilities 1,916 1,819 Total liabilities 47,719 53,455 Shareholders’ equity Ordinary shares - - Retained earnings 53,931 54,414 Accumulated other comprehensive (loss) (1,868) (1,184) Total shareholders’ equity 52,063 53,230 Total liabilities and shareholders’ equity $99,782 $106,685 Use the following assumptions to forecast the company’s balance sheet for FY2017. Forecasted FY2017 net income $4,972 million Forecasted FY2017 net sales $35,176 million Accounts receivable 19.3% of net sales Inventories 12.0% of net sales Tax assets 2.4% of net sales Prepaid expenses and other current assets 4.3% of net sales Long-term tax assets 4.8% of net sales Other assets 5.4% of net sales Accounts payable 5.9% of net sales Accrued compensation 5.9% of net sales Accrued income taxes 2.0% of net sales Other accrued expenses 7.6% of net sales Long-term accrued income taxes 10.1% of net sales Long-term deferred tax liabilities 12.9% of net sales Other long-term liabilities 6.6% of net sales Investments No change Goodwill No change Long-term accrued compensation and retirement benefits No change Ordinary shares No change Accumulated other comprehensive (loss) No change CAPEX 3.6% of net sales Depreciation expense 18.9% of prior year PPE, net Amortization expense in FY2016 $1,931 million Current maturities of debt due in FY2017 $993 million Current maturities of debt due in FY2018 $6,176 million Dividend payout ratio 60.5% Round your answers to the nearest whole number. Use a negative sign with your Accumulated other comprehensive loss answer. Medtronic plc Forecasted Consolidated Balance Sheet ($ millions) EST. 2017 Current assets Cash and cash equivalents Answer Investments Answer Accounts receivable Answer Inventories Answer Tax assets Answer Prepaid expenses and other current assets Answer Total current assets Answer Property, plant, and equipment, net Answer Goodwill Answer Other intangible assets, net Answer Long-term tax assets Answer Other assets Answer Total assets Answer Current liabilities Short-term borrowings Answer Accounts payable Answer Accrued compensation Answer Accrued income taxes Answer Other accrued expenses Answer Total current liabilities Answer Long-term debt Answer Long-term accrued compensation Answer Long-term accrued income taxes Answer Long-term deferred tax liabilities Answer Other long-term liabilities Answer Total liabilities Answer Shareholders’ equity Ordinary shares - Retained earnings Answer Accumulated other comprehensive (loss) Answer Total shareholders’ equity Answer Total liabilities and shareholders’ equity Answer

Forecast the Balance Sheet Following is the balance sheet for Medtronic PLC for the year ended April 29, 2016. Medtronic plc Consolidated Balance Sheets ($ millions) Apr. 29, 2016 Apr. 24, 2015 Current assets Cash and cash equivalents $2,876 $4,843 Investments 9,758 14,637 Accounts receivable 5,562 5,112 Inventories 3,473 3,463 Tax assets 697 1,335 Prepaid expenses and other current assets 1,234 1,454 Total current assets 23,600 30,844 Property, plant, and equipment, net 4,841 4,699 Goodwill 41,500 40,530 Other intangible assets, net 26,899 28,101 Long-term tax assets 1,383 774 Other assets 1,559 1,737 Total assets $99,782 $106,685 Current liabilities Short-term borrowings $993 $2,434 Accounts payable 1,709 1,610 Accrued compensation 1,712 1,611 Accrued income taxes 566 935 Deferred tax liabilities - 119 Other accrued expenses 2,185 2,464 Total current liabilities 7,165 9,173 Long-term debt 30,247 33,752 Long-term accrued compensation 1,759 1,535 Long-term accrued income taxes 2,903 2,476 Long-term deferred tax liabilities 3,729 4,700 Other long-term liabilities 1,916 1,819 Total liabilities 47,719 53,455 Shareholders’ equity Ordinary shares - - Retained earnings 53,931 54,414 Accumulated other comprehensive (loss) (1,868) (1,184) Total shareholders’ equity 52,063 53,230 Total liabilities and shareholders’ equity $99,782 $106,685 Use the following assumptions to forecast the company’s balance sheet for FY2017. Forecasted FY2017 net income $4,972 million Forecasted FY2017 net sales $35,176 million Accounts receivable 19.3% of net sales Inventories 12.0% of net sales Tax assets 2.4% of net sales Prepaid expenses and other current assets 4.3% of net sales Long-term tax assets 4.8% of net sales Other assets 5.4% of net sales Accounts payable 5.9% of net sales Accrued compensation 5.9% of net sales Accrued income taxes 2.0% of net sales Other accrued expenses 7.6% of net sales Long-term accrued income taxes 10.1% of net sales Long-term deferred tax liabilities 12.9% of net sales Other long-term liabilities 6.6% of net sales Investments No change Goodwill No change Long-term accrued compensation and retirement benefits No change Ordinary shares No change Accumulated other comprehensive (loss) No change CAPEX 3.6% of net sales Depreciation expense 18.9% of prior year PPE, net Amortization expense in FY2016 $1,931 million Current maturities of debt due in FY2017 $993 million Current maturities of debt due in FY2018 $6,176 million Dividend payout ratio 60.5% Round your answers to the nearest whole number. Use a negative sign with your Accumulated other comprehensive loss answer. Medtronic plc Forecasted Consolidated Balance Sheet ($ millions) EST. 2017 Current assets Cash and cash equivalents Answer Investments Answer Accounts receivable Answer Inventories Answer Tax assets Answer Prepaid expenses and other current assets Answer Total current assets Answer Property, plant, and equipment, net Answer Goodwill Answer Other intangible assets, net Answer Long-term tax assets Answer Other assets Answer Total assets Answer Current liabilities Short-term borrowings Answer Accounts payable Answer Accrued compensation Answer Accrued income taxes Answer Other accrued expenses Answer Total current liabilities Answer Long-term debt Answer Long-term accrued compensation Answer Long-term accrued income taxes Answer Long-term deferred tax liabilities Answer Other long-term liabilities Answer Total liabilities Answer Shareholders’ equity Ordinary shares - Retained earnings Answer Accumulated other comprehensive (loss) Answer Total shareholders’ equity Answer Total liabilities and shareholders’ equity Answer

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter10: Long-term Liabilities

Section: Chapter Questions

Problem 10.9MCP

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Question

Forecast the Balance Sheet

Following is the balance sheet for Medtronic PLC for the year ended April 29, 2016.

Medtronic plc
Consolidated Balance Sheets
($ millions)	Apr. 29, 2016	Apr. 24, 2015
Current assets
Cash and cash equivalents	$2,876	$4,843
Investments	9,758	14,637
Accounts receivable	5,562	5,112
Inventories	3,473	3,463
Tax assets	697	1,335
Prepaid expenses and other current assets	1,234	1,454
Total current assets	23,600	30,844
Property, plant, and equipment, net	4,841	4,699
Goodwill	41,500	40,530
Other intangible assets, net	26,899	28,101
Long-term tax assets	1,383	774
Other assets	1,559	1,737
Total assets	$99,782	$106,685
Current liabilities
Short-term borrowings	$993	$2,434
Accounts payable	1,709	1,610
Accrued compensation	1,712	1,611
Accrued income taxes	566	935
Deferred tax liabilities	-	119
Other accrued expenses	2,185	2,464
Total current liabilities	7,165	9,173
Long-term debt	30,247	33,752
Long-term accrued compensation	1,759	1,535
Long-term accrued income taxes	2,903	2,476
Long-term deferred tax liabilities	3,729	4,700
Other long-term liabilities	1,916	1,819
Total liabilities	47,719	53,455
Shareholders’ equity
Ordinary shares	-	-
Retained earnings	53,931	54,414
Accumulated other comprehensive (loss)	(1,868)	(1,184)
Total shareholders’ equity	52,063	53,230
Total liabilities and shareholders’ equity	$99,782	$106,685

Use the following assumptions to forecast the company’s balance sheet for FY2017.

Forecasted FY2017 net income	$4,972 million
Forecasted FY2017 net sales	$35,176 million
Accounts receivable	19.3% of net sales
Inventories	12.0% of net sales
Tax assets	2.4% of net sales
Prepaid expenses and other current assets	4.3% of net sales
Long-term tax assets	4.8% of net sales
Other assets	5.4% of net sales
Accounts payable	5.9% of net sales
Accrued compensation	5.9% of net sales
Accrued income taxes	2.0% of net sales
Other accrued expenses	7.6% of net sales
Long-term accrued income taxes	10.1% of net sales
Long-term deferred tax liabilities	12.9% of net sales
Other long-term liabilities	6.6% of net sales
Investments	No change
Goodwill	No change
Long-term accrued compensation and retirement benefits	No change
Ordinary shares	No change
Accumulated other comprehensive (loss)	No change
CAPEX	3.6% of net sales
Depreciation expense	18.9% of prior year PPE, net
Amortization expense in FY2016	$1,931 million
Current maturities of debt due in FY2017	$993 million
Current maturities of debt due in FY2018	$6,176 million
Dividend payout ratio	60.5%

Round your answers to the nearest whole number.
Use a negative sign with your Accumulated other comprehensive loss answer.

Medtronic plc
Forecasted Consolidated Balance Sheet
($ millions)				EST. 2017
Current assets
Cash and cash equivalents				Answer
Investments				Answer
Accounts receivable				Answer
Inventories				Answer
Tax assets				Answer
Prepaid expenses and other current assets				Answer
Total current assets				Answer
Property, plant, and equipment, net				Answer
Goodwill				Answer
Other intangible assets, net				Answer
Long-term tax assets				Answer
Other assets				Answer
Total assets				Answer
Current liabilities
Short-term borrowings				Answer
Accounts payable				Answer
Accrued compensation				Answer
Accrued income taxes				Answer
Other accrued expenses				Answer
Total current liabilities				Answer
Long-term debt				Answer
Long-term accrued compensation				Answer
Long-term accrued income taxes				Answer
Long-term deferred tax liabilities				Answer
Other long-term liabilities				Answer
Total liabilities				Answer
Shareholders’ equity
Ordinary shares				-
Retained earnings				Answer
Accumulated other comprehensive (loss)				Answer
Total shareholders’ equity				Answer
Total liabilities and shareholders’ equity				Answer

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