Looking at the income statement, you can see here that we have three years of historical data. For the income statement, it's particularly important we have lots of historical data to help us understand the company better and make better predictions for our forecasts. The data here is literally just taken from the financial statements and typed into this model. The numbers are colored in blue so that we know that these are hard-coded numbers. There's no formula in these cells. However, there are some gaps in our historical numbers because these are going to be calculated numbers. Although we could type these in from the financial statements, it's much more useful to calculate them as we can then check the result against the financial statements to make sure that we've copied the other numbers correctly and that we haven't emitted any numbers. So let's start by calculating EBIT, which is of course revenues less operating costs. Now, Hershey is a US company and US companies typically report their costs as a positive number, and that's what we can see here. And this sign convention is also used in the model. So to calculate EBIT, we need to take revenues and deduct operating costs. I can then do a quick check to the company's accounts to make sure that the EBIT shown here of 1,596 matches what is in their income statement. I can then copy this formula to the right, and I'm going to do this all the way into my first forecast year. This means that I have the formula ready and waiting for me when I start to build my forecasts.

Also, I will need to do a quick check to make sure that the historic EBIT for 2020 and 2021 also matches their financial statements. So let's move down and calculate earnings before tax, which is EBIT less net interest expense less other expenses. And again, I'll copy this across to my first forecast year. Last is net income, which is earnings before tax less the tax expense. And again, I'll copy this across to my first forecast year. And once again, we would check our numbers here against what is reported in the financial statements.

Let's move on down to the balance sheet now.

And we're gonna go through a similar process here. Again, needing to calculate some subtotals. And this time we've only got two years of historic numbers. First, we need to calculate total assets, and this time we can use AutoSum because that will automatically sum all of the numbers in the rows above, and that's just Alt + = and then Enter. And again, I'll check the numbers against the financial statements and copy that formula into my first forecast year. Now let's do the same for total liabilities. AutoSum again, and then copy that formula to the right. The final subtotal in my balance sheet is total liabilities and equity. I can't AutoSum that, so I just need to pop the formula, which adds total liabilities and equity, and copy that to the right and then check your numbers against the financial statements. Last up, we need to run a check on our historical balance sheet data. Published financial statements definitely should balance, so the historical data in the model should balance too. My check is going to be to subtract total assets from total liabilities and equity.

Phew, my balance sheet balances. This reassures me that I've copied the numbers from the financials correctly and that our subtotals are accurate. So I can then copy this balance sheet check all the way into my first forecast year so that's ready and waiting for me when I build my forecasts. So we've now input our subtotals for our historical data.