=+LG 3 P4–6 Finding operating and free cash flows Consider the following balance sheets and selected data from the income statement of Keith Corporation.

X MyLab Keith Corporation Balance Sheets December 31 Assets 2019 2018 Cash $ 1,500 $ 1,000 Marketable securities 1,800 1,200 Accounts receivable 2,000 1,800 Inventories 2,900 2,800 Total current assets $ 8,200 $ 6,800 Gross fixed assets $29,500 $28,100 Less: Accumulated depreciation 14,700 13,100 Net fixed assets $14,800 $15,000 Total assets $23,000 $21,800 Keith Corporation Balance Sheets (continued)
December 31 Liabilities and stockholders’ equity 2019 2018 Accounts payable $ 1,600 $ 1,500 Notes payable 2,800 2,200 Accruals 200 300 Total current liabilities $ 4,600 $ 4,000 Long-term debt 5,000 5,000 Total liabilities $ 9,600 $ 9,000 Common stock $10,000 $10,000 Retained earnings 3,400 2,800 Total stockholders’ equity $13,400 $12,800 Total liabilities and stockholders’ equity $23,000 $21,800 Keith Corporation Income Statement Data (2019)
Depreciation expense $1,600 Earnings before interest and taxes (EBIT) 2,700 Interest expense 367 Net profits after taxes 1,400 Tax rate 21%