Question

Jim's espresso expects sales to grow by 10% next year. using the following statements and the percent of sales method, forecast the following. (round to the nearest dollar.) (assume no additional borrowing at this point.)

Answer 1

To forecast the sales growth using the percent of sales method, we multiply the current sales by the growth rate. In this case, the sales forecast for next year is $110,000.

Step-by-step explanation:

To forecast the sales growth using the percent of sales method, we need to understand that sales growth is calculated by multiplying the current sales by the percent growth rate. In this case, Jim's espresso expects sales to grow by 10% next year. Let's assume the current sales are $100,000. To calculate the sales forecast for next year, we multiply the current sales by the growth rate:

Sales forecast = Current sales imes (1 + Growth rate)

Sales forecast = $100,000 imes (1 + 0.10) = $110,000

Therefore, the sales forecast for next year is $110,000.