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Forecast the 2019 Cost of goods sold on the previous year’s number and the assumptions 2018...

Forecast the 2019 Cost of goods sold on the previous year’s number and the assumptions 2018 Actual 2019 Estimate Sales Growth 6% 8% Gross Margin 40% 40% Revenues 50,000 Cost of Goods Sold 27,000

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Answer #1

Data given:

2018

2019

actual

estimates

Sales Growth

6%

8%

Gross Margin

40%

40%

Revenue

50000

COGS

27000

it is estimated that the revenue will increase by 8%

so the sales for 2019

= 50000*108%

=54000

Gross margin of 2019 = Profit/sales

= 0.40= profit/54000

Gross Profit of 2019= 54000*0.40= 21600

Profit= Revenue-COGS

= 21600= 54000- COGS

COGS of 2019 = 54000-21600

= $32400

So the cost of goods sold for the next year is forecast to be $32400.

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