90.2K

Verified Solution

Link Copied!

QUESTION 11 Using the following firm's financial statements, answer the following questions Balance Sheets as of December 31 (millions of dollars) 2018 2019 Assets 100 110 20 22 420 500 300 320 840 952 600 750 1,440 1,702 Cash Short-term investments Accounts receivable Inventories Total current assets Net fixed assets Total assets Liabilities and Equity Accounts payable Notes payable Accruals Total current liabilities Long-term debt Common stocks Retained earnings Total equity Total liabilities and equity 220 250 150 180 170 170 540 600 420 542 300 360 180 200 480 560 1,440 1,702 2019 5,500 2,900 460 Income Statement for year ending December 31 (millions of Dollars) 2018 Sales 4,100 Cost of goods sold (excluding 2,000 depreciation and amortization) Other expenses 350 Depreciation and amortization 100 Total operating costs 2,450 EBIT 1,650 Interest expenses 75 Pre-tax earnings 1,575 Taxes (40%) 630 Net income 945 110 3,470 2,030 90 1,940 776 1,164 a. What is the net operating profit after taxes (NOPAT) for 2019? (5 points) b. What are the amounts of net operating working capital for both years, 2018 and 2019? (5 points) c. What are the amounts of total net operating capital for both years, 2018 and 2019? (5 points) d. What is the free cash flow for 2019? (5 points)

Answer & Explanation Solved by verified expert

See Answer