Jim's Espresso expects sales to grow by 10.2 % next year. Using the following statements and the percent of sales method, forecast:
a. Costs
b. Depreciation
c. Net Income
d. Cash
e. Accounts receivable
f. Inventory
g. Property, plant, and equipment (Note: Make sure to round all intermediate calculations to at least five decimal places.)
The Tax Cuts and Jobs Act of 2017 temporarily allow 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career.