Following are Cisco Systems sales, net operating profit after tax (NOPAT), and net operating assets (NOA) for
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Question:
Following are Cisco Systems’ sales, net operating profit after tax (NOPAT), and net operating assets (NOA) for its year ended July 31, 2016 ($ millions).
Sales | $49,247 | |||
Net operating profit after tax (NOPAT) | 10,575 | |||
Net operating assets (NOA) | 26,472 |
Use the parsimonious method to forecast Cisco’s sales, NOPAT, and NOA for years 2017 through 2020 using the following assumptions.
Sales growth per year | 1.0% | for 2017 and | |||||
2.0% | thereafter | ||||||
Net operating profit margin (NOPM) | 21.5% | ||||||
Net operating asset turnover (NOAT), based on NOA at July 31, 2016 | 1.86 |
Rounding instructions:
Round total revenue "unrounded" to two decimal places.
Round total revenue "rounded", NOPAT and NOA answers to the nearest whole number.
For NOPAT and NOA computations, use total revenue "rounded".
$ millions | 2017 Est | 2018 Est. | 2019 Est. | 2020 Est. | ||
---|---|---|---|---|---|---|
Total revenue (unrounded) | $Answer | $Answer | $Answer | $Answer | ||
Total revenue (rounded) | Answer | Answer | Answer | Answer | ||
NOPAT | Answer | Answer | Answer | Answer Incorrect | ||
NOA | Answer | Answer | Answer | Answer |
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ISBN: 978-1118630914
1st edition
Authors: Robert A.Weigand
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