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Mico Chip Computer Corporation

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Mico Chip Computer Corporation

Year 2000 2001 2002 2003 2004 2005

Net Sales 11,062 11,933 9,181 6,141 8,334 9,167

Year to Year Growth 7.8% -23.1% -33.1% 35.7% 10%

Micro Chip Computer Corporation

Calculations for determining year-to-year percentage annual growth

(2001) 11,062-11,933=-871

-871/11,062=-0.078= 7.8%

(2002) 11,933-9,181=2,752

2,752/11,933=0.2306= -23.1%

(2003) 9,181-6,141=3,040

3,040/9,181=0.3311= -33.1%

(2004) 6,141-8,334=-2,193

-2,193/6,141=-0.357= 35.7%

Finding 10% increase in sales (Target Revenue Figure)

(2005) 8,334*1.1=9,167

8,334-9167=-833

-8,33/8334=-.0999= 10%

Arriving at a target figure of $9,167 one can deduce that in 2005 that the company can meet its sales goal of +10% likely that the company would meet its sales goal of+10%. Looking at the sales growth overall one can see how the company has done over the past several years. Starting from the year 2000 till 2001, the sales grew by roughly 8%; the next two years showed a sharp decline that resulted from troubled economic times for the nation. Then in year five rose to exceed expectations. Year six shows good promise that the +10% annual revenue growth can be attained.

Micro Chip Computer Corporation Consolidated Statement

Consolidated Statement of Operations 2004 2005

Sales 8,334.00 10,000.80

Cost of Sales 5,458.00 65.5% 6549.60 65.5%

Gross Margin 2,876.00 34.5% 3451.20 34.5%

Operating Expenses

R&D 525.00 6.3% 630.00 6.3%

Selling General and Administrative 691.00 8.3% 829.20 8.3%

In Process R&D

Restructuring Cost 200.02 2%

Total Operating expenses 1,216.00 14.6% 1659.22 16.6%

Operating Income 1,660.00 20% 1791.98 17.9%

Total Income and Other Income Net 194.00 2.3% 232.80 2.3%

Income Before Provision For Income Taxes 1,854.00 22.2% 2,024.78 20.2%

Provision for Income taxes (15%) 278.10 3.3% 303.72 3%

Net Income 1,575.90 19% 1,721.07 17.2%

Calculations for Pro Forma Statement

Sales 8,334+20%=10,000.80

Cost of Sales 5,458+20%=6,549.6

Gross Margin 10,000.80-6,549.6=3,451.2

R&D 525+20%=630

SG&A 691+20%=829.2

Restructuring Cost 10,000.80*2%=200.02

Total Operating Expenses 630+829.2+200.02=1,659.22

Operating Income 3,451.2-1,659.22=1,791.98

Total Income and Other Net Income 194+20%=232.80

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