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Rhodes Corporations financial statements are shown below.

Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)

2020 2019

Sales $12,000 $10,000

Operating costs excluding depreciation 10,502 8,666

Depreciation and amortization 390 370

Earnings before interest and taxes $ 1,108 $ 964

Less interest 180 100

Pre-tax income $ 928 $ 864

Taxes (25%) 232 216

Net income available to common stockholders $ 696 $ 648

Common dividends $ 201 $ 200

Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)

2020 2019

Assets Cash $ 650 $ 600

Short-term investments 110 100

Accounts receivable 2,750 2,500

Inventories 1,450 1,200

Total current assets $4,960 $4,400

Net plant and equipment 3,850 3,500

Total assets $ 8,810 $ 7,900

Liabilities and Equity Accounts payable $ 1,300 $ 1,200

Accruals 650 600

Notes payable 186 100

Total current liabilities $ 2,136 $ 1,900

Long-term debt 1,300 1,200

Total liabilities $ 3,436 3,100

Common stock 3,679 3,600

Retained earnings 1,695 1,200

Total common equity $ 5,374 $ 4,800

Total liabilities and equity $ 8,810 $ 7,900

Suppose the federal-plus-state tax corporate tax is 25%. Answer the following questions.

a.What is the net operating profit after taxes (NOPAT) for 2020? Enter your answer in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answer to the nearest whole number.

$ million

b.What are the amounts of net operating working capital for both years? Enter your answers in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answers to the nearest whole number.

2020: $ million

2019: $ million

c.What are the amounts of total net operating capital for both years? Enter your answers in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answers to the nearest whole number.

2020: $ million

2019: $ million

d.What is the free cash flow for 2020? Enter your answer in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Cash outflow, if any, should be indicated by a minus sign. Round your answer to the nearest whole number.

$ million

e.What is the ROIC for 2020? Round your answer to two decimal places.

%

f.How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answers in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answers to the nearest whole number.

After-tax interest payment $ million

Reduction (increase) in debt $ million

Payment of dividends $ million

Repurchase (Issue) stock $ million

Purchase (Sale) of short-term investments $ million

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