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

Next, consider Micro Chip's Consolidated Statement of Operations for the year ended September 25, 2008.

Download the file here and answer questions 1 and 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, 2007 through September 25, 2008. Assume a 15% tax rate and restructuring costs of 2% 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?

To receive full credit on this assignment, please show all work, including formulas and calculations used to arrive at the financial values. Students using Microsoft Excel must provide an adequate explanation of the methodology used to arrive at that answer.