South Sea Baubles has the following incomplete balance sheet and income statement.

a. What is shareholders' equity in 2014 and 2015?
b. What is net working capital in 2014 and 2015?
c. What is taxable income and taxes paid in 2015? Assume the firm pays taxes equal to 35% of taxable income.
d. What is cash flow provided by operations during 2015? Pay attention to changes in net working capital.
e. What must have been South Sea's gross investment in fixed assets (capital expenditure) during 2015? See Check Point 3.1.
f. If South Sea reduced its outstanding accounts payable by $35 million during 2008, what must have happened to its other current liabilities?
g. What are the 2015 cash flow from assets, and cash flow to bondholders and shareholders? State all assumptions you make.

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South Sea Baubles Balance Sheet, as of End of Year ($ millions) Assets 2015 2014 $ 90 Current assets $140 Net fixed assets 900 800 Liabilities and Shareholders' Equity Current liabilities $ 60 $ 50 Long-term debt 600 750 Income Statement, 2015 ($ millions) Revenue $1,950 (1,030) Cost of goods sold Depreciation 350 Interest expense 240