In this workout and analyst has started building a quarterly model and has completed quarterly forecast for the income statement and the balance sheet. We asked to use the information provided to complete the forecast income statements and balance sheet on an annual basis. If we scroll down we can first see the assumptions used to build the quarterly forecasts. And then if we continue to scroll down we can see the quarterly income statement forecasts. The calculations for the balance sheet and finally the balance sheet itself. Note that the income statement excludes interest and the balance sheet excludes cash and the revolver as the cash flow statement calculations. Haven't yet been built. To build the annual forecasts. We'll start with the income statements. So let's scroll up to that first. Here the annual forecasts are calculated now for the income statement. The annual forecasts are calculated by summing the four quarterly forecasts. So if we scroll over to the right, we simply need to build a thumb.

And that's the sum of the four quarters. We can copy this formula down now for operating costs.

And also tax expense.

My subtotals just need to be copied over from the fourth quarter.

The next step is to build the annual forecast for the calculations.

We'll start off with a long-term assets calculation and we just need to remember that the ending balances on these are the balance sheet amounts. And therefore the end of Q4 is also the end of the First Financial year. so our ending balance for Q4 Is also ending balance for FY one? Now, let's do the same for equity.

And finally for working capital.

Now, let's build our annual forecast for the balance sheet.

Similar to the calculation section the ending balances for Q4 are also the ending balances for the First Financial year. So we simply link our annual forecasts to the Q4 balances.

We've now completed the income statement and balance sheet annual forecasts using the quarterly forecasts.