A D E F G 1 2 Caterpillar Inc (CAT US) Standardized 3 FY 2015 12 31 2015 FY 2016 12 31 2016 FY 2017 12 31 2017 FY 2018 12 31 2018 FY 2019 12 31 2019 7,168 0 7,168 0 0 0 14,441 0 5,919 0 8,522 0 8,614 0 2,102 0 1,719 0 4,576 0 217 0 1,744 0 62 0 8,261 0 8,261 0 0 0 16,133 0 7,376 0 8,757 0 10,018 0 2,802 0 2,254 0 4,761 0 201 0 1,832 0 60 0 7,857 0 7,857 0 0 0 17,364 0 8,714 0 8,650 0 11,529 0 3,382 0 2,674 0 5,241 0 232 0 1,853 0 88 0 8,284 0 8,284 0 0 0 17,820 0 8,484 0 9,336 0 11,266 0 4,263 0 1,147 0 5,598 0 258 0 1,823 0 84 0 0 0 4 In Millions of USD except Per Share 5 12 Months Ending 6 Total Assets 7 Cash, Cash Equivalents STI 8 Cash Cash Equivalents 9 ST Investments 10 Accounts Notes Receiv 11 Accounts Receivable, Net 12 Notes Receivable, Net 13 Inventories 14 Raw Materials 15 Work In Process 16 Finished Goods 17 Other Inventory 18 Other ST Assets 19 Derivative Hedging Assets 20 Deferred Tax Assets 21 Misc ST Assets 22 Total Current Assets 23 Property, Plant Equip, Net 24 Property, Plant Equip 25 Accumulated Depreciation 26 LT Investments Receivables 27 LT Receivables 28 Other LT Assets 29 Total Intangible Assets 30 Goodwill 31 Other Intangible Assets 32 Deferred Tax Assets 33 Derivative Hedging Assets 34 Investments in Affiliates 35 Misc LT Assets 36 Total Noncurrent Assets 37 Total Assets 6,460 0 6,460 0 0 0 15,668 0 6,677 0 8,991 0 9,700 0 2,467 0 1,857 0 5,122 0 254 0 1,680 0 18 0 0 0 1,662 0 33,508 0 16,090 0 31,977 0 15,887 0 14,821 0 14,821 0 13,923 0 9,436 0 6,615 0 2,821 0 2,489 0 87 0 246 0 1,665 0 44,834 0 78,342 0 1,682 0 31,967 0 15,322 0 31,940 0 16,618 0 14,585 0 14,585 0 12,830 0 8,369 0 6,020 0 2,349 0 2,790 0 33 0 249 0 1,389 0 42,737 0 74,704 0 1,772 0 36,244 0 14,155 0 31,538 0 17,383 0 14,532 0 14,532 0 12,031 0 8,311 0 6,200 0 2,111 0 1,693 0 14 0 243 0 1,770 0 40,718 0 76,962 0 1,765 0 38,603 0 13,574 0 29,781 0 16,207 0 14,447 0 14,447 0 11,885 0 8,114 0 6,217 0 1,897 0 1,439 0 43 0 1,739 0 39,193 0 13,528 0 29,841 00 16,313 0 13,844 0 13,844 0 11,888 0 7,761 0 6,196 0 1,565 0 1,411 0 32 0 2,289 0 39,906 0 78,509 0 2,684 0 39,260 0 78,453 0 38 11,832 0 5,957 0 0 0 10,525 0 5,023 0 0 0 448 0 5,054 0 12,844 0 6,967 0 9,234 0 4,614 0 0 0 452 0 4,168 0 13,965 0 7,303 0 12,641 0 6,487 0 0 0 466 0 5,688 0 11,031 0 4,837 0 13,362 0 7,051 0 0 0 495 0 5,816 0 11,553 0 5,723 0 5,877 0 2,873 0 0 0 56 0 2,817 0 26,242 0 25,169 0 25,092 0 6,662 0 2,933 0 0 0 131 0 2,802 0 26,132 0 22,818 0 22,750 0 68 0 68 0 6,194 0 3,259 0 0 0 91 0 3,168 0 26,931 0 23,847 0 23,770 0 77 0 77 0 5,830 0 3,303 0 0 0 141 0 3,162 0 28,218 0 25,000 0 25,000 0 77 0 77 0 39 Liabilities Shareholders' Equity 40 Payables Accruals 41 Accounts Payable 42 Accrued Taxes 43 Interest Dividends Payable 44 Other Payables Accruals 45 ST Debt 46 ST Borrowings 47 ST Lease Liabilities 48 ST Finance Leases 49 ST Operating Leases 50 Current Portion of LT Debt 51 Other ST Liabilities 52 Deferred Revenue 53 Derivatives Hedging 54 Misc ST Liabilities 55 Total Current Liabilities 56 LT Debt 57 LT Borrowings 58 LT Lease Liabilities 59 LT Finance Leases 60 LT Operating Leases 61 Other LT Liabilities 62 Accrued Liabilities 63 Pension Liabilities 64 Deferred Revenue 65 Derivatives Hedging 66 Misc LT Liabilities 67 Total Noncurrent Liabilities 68 Total Liabilities 69 Preferred Equity and Hybrid Capital 70 Share Capital APIC 71 Common Stock 72 Additional Paid in Capital 73 Treasury Stock 74 Retained Earings 75 Other Equity 76 Equity Before Minority Interest 77 Minority Non Controlling Interest 78 Total Equity 79 Total Liabilities Equity 80 12,046 0 0 0 8,843 0 0 0 0 0 3,203 0 37,215 0 63,457 0 0 0 5,238 0 814 9 4,423 1 17,640 0 29,246 0 2,035 0 14,809 0 76 0 14,885 0 78,342 0 12,541 0 0 0 9,357 0 0 0 36 0 3,148 0 35,359 0 61,491 0 0 0 5,277 0 814 9 4,462 1 17,478 0 27,377 0 2,039 0 13,137 0 76 0 13,213 0 74,704 0 12,418 0 0 0 8,365 0 0 0 2 0 4,051 0 36,265 0 63,196 0 0 0 5,593 0 814 9 4,778 1 17,005 0 26,301 0 1,192 0 13,697 0 69 0 13,766 0 76,962 0 11,211 0 0 0 7,455 0 0 0 9 0 3,747 0 36,211 0 64,429 0 0 0 5,827 0 814 9 5,012 1 20,531 0 30,427 0 1,684 0 14,039 0 41 0 14,080 0 78,509 0 567 0 5,308 0 11,549 0 5,166 0 173 0 0 0 173 0 6,210 0 3,240 0 0 0 71 0 3,169 0 26,621 0 26,742 0 26,281 0 461 0 0 0 461 0 10,461 0 0 0 6,599 0 0 0 0 0 3,862 0 37,203 0 63,824 0 0 0 5,935 0 814 9 5, 120 1 24,217 0 34,437 0 1,567 0 14,588 0 41 0 14,629 0 78,453 0 n2846889 A C D E F G FY 2015 12 31 2015 47,011 0 44,147 0 2,864 0 34,133 0 33,546 0 587 0 12,878 0 0 0 7,971 0 4,951 0 2,119 0 901 0 4,907 0 346 0 442 0 507 0 65 0 173 0 269 0 4,561 0 1,122 0 4 In Millions of USD except Per Share 5 12 Months Ending 6 Revenue 7 Sales Services Revenue 8 Financing Revenue 9 Cost of Revenue 10 Cost of Goods Services 11 Cost of Financing Revenue 12 Gross Profit 13 Other Operating Income 14 Operating Expenses 15 Selling, General Admin 16 Research Development 17 Other Operating Expense 18 Operating Income (Loss) 19 Non Operating (Income) Loss 20 Interest Expense, Net 21 Interest Expense 22 Interest Income 23 Foreign Exch (Gain) Loss 24 Other Non Op (Income) Loss 25 Pretax Income (Loss), Adjusted 26 Abnormal Losses (Gains) 27 Merger Acquisition Expense 28 Abnormal Derivatives 29 Asset Write Down 30 Impairment of Goodwill 31 Impairment of Intangibles 32 Gain Loss on Sale Acquisition of Busine 33 Legal Settlement 34 Restructuring 35 Sale of Investments 36 Other Abnormal Items 37 Pretax Income (Loss), GAAP 38 Income Tax Expense (Benefit) 39 Current Income Tax 40 Deferred me Tax 41 Tax Allowance Credit 42 (Income) Loss from Affiliates 43 Income (Loss) from Cont Ops 44 Net Extraordinary Losses (Gains) 45 Discontinued Operations 46 XO Accounting Changes FY 2016 12 31 2016 38,537 0 35,773 0 2,764 0 28,640 0 28,044 0 596 0 9,897 0 0 0 6,136 0 4,383 0 1,853 0 100 0 3,761 0 1,108 0 431 0 505 0 74 0 57 0 620 0 2,653 0 2,514 0 FY 2017 12 31 2017 45,462 0 42,676 0 2,786 0 31,906 0 31,260 0 646 0 13,556 0 0 0 7,539 0 4,999 0 1,842 0 698 0 6,017 0 461 0 409 0 531 0 122 0 213 0 161 0 5,556 0 1,474 0 FY 2018 12 31 2018 54,722 0 51,822 0 2,900 0 37,719 0 36,997 0 722 0 17,003 0 0 0 7,829 0 5,478 0 1,850 0 501 0 9,174 0 471 0 209 0 404 0 195 0 201 0 61 0 8,703 0 881 0 FY 2019 12 31 2019 53,800 0 50,755 0 3,045 0 37,384 0 36,630 0 754 0 16,416 0 0 0 7,422 0 5,162 0 1,693 0 567 0 8,994 0 478 0 219 0 421 0 202 0 67 0 192 0 8,516 0 704 0 595 0 1 11111 TC 943 0 386 0 236 0 179 0 3,439 0 916 0 1,223 0 307 1,019 0 85 0 985 0 139 0 192 0 623 0 1,256 0 83 0 301 0 4,082 0 3,339 0 2,126 0 ,213 0 495 0 7,822 0 1,698 0 1,478 0 220 0 468 0 7,812 0 1,746 0 1,718 0 28 0 31 28 0 0 0 2,523 0 0 0 0 0 0 0 6 0 59 0 0 0 0 0 0 0 16 0 759 0 0 0 0 0 0 0 24 0 6,148 0 0 0 0 0 0 0 6,094 0 0 0 0 0 0 0 2,523 0 11 0 2,512 0 0 0 0 0 2,512 0 59 0 8 0 67 0 0 0 0 0 67 0 759 0 5 0 754 0 0 0 0 0 754 0 6,148 0 1 0 6,147 0 0 0 0 0 6,147 0 6,094 0 1 0 6,093 0 0 0 0 0 6,093 0 3,215 5 703 5 0 0 1,916 4 1,983 4 0 0 4,122 7 3,368 7 0 0 6,817 3 670 3 0 0 6,451 6 358 6 0 0 47 Income (Loss) Incl MI 48 Minority Interest 49 Net Income, GAAP 50 Preferred Dividends 51 Other Adjustments 52 Net Income Avail to Common, GAAP 53 54 Net Income Avail to Common, Adj 55 Net Abnormal Losses (Gains) 56 Net Extraordinary Losses (Gains) 57 58 Basic Weighted Avg Shares 59 Basic EPS, GAAP 60 Basic EPS from Cont Ops 61 Basic EPS from Cont Ops, Adjusted 62 63 Diluted Weighted Avg Shares 64 Diluted EPS, GAAP 65 Diluted EPS from Cont Ops 66 Diluted EPS from Cont Ops, Adjusted 67 594 3 4 23 4 23 5 41 584 3 0 11 0 11 3 28 591 8 1 27 1 27 6 97 591 4 10 39 10 39 11 53 561 6 10 85 10 85 11 49 601 3 4 18 4 18 5 35 584 3 0 11 0 11 3 28 599 3 1 26 1 26 6 88 599 4 10 26 10 26 11 38 567 5 10 74 10 74 11 37 Suppose we want to calculate the WACC for CAT in 2019 Knowing the equity value is $93,283 M, what is the weight for the cost of debt (Please review Lecture 5 and HW3if needed) 22 28 24 34 16 52 O 29 10 QUESTION 8 Based on the Income statement, what is the average tax rate of CAT in the past THREE years Note In an adjusted income statement, the Profit before tax is Pretax Income (Loss), GAAP 25 49 33 37 58 12 41 95 A D E F G 1 2 Caterpillar Inc (CAT US) Standardized 3 FY 2015 12 31 2015 FY 2016 12 31 2016 FY 2017 12 31 2017 FY 2018 12 31 2018 FY 2019 12 31 2019 7,168 0 7,168 0 0 0 14,441 0 5,919 0 8,522 0 8,614 0 2,102 0 1,719 0 4,576 0 217 0 1,744 0 62 0 8,261 0 8,261 0 0 0 16,133 0 7,376 0 8,757 0 10,018 0 2,802 0 2,254 0 4,761 0 201 0 1,832 0 60 0 7,857 0 7,857 0 0 0 17,364 0 8,714 0 8,650 0 11,529 0 3,382 0 2,674 0 5,241 0 232 0 1,853 0 88 0 8,284 0 8,284 0 0 0 17,820 0 8,484 0 9,336 0 11,266 0 4,263 0 1,147 0 5,598 0 258 0 1,823 0 84 0 0 0 4 In Millions of USD except Per Share 5 12 Months Ending 6 Total Assets 7 Cash, Cash Equivalents STI 8 Cash Cash Equivalents 9 ST Investments 10 Accounts Notes Receiv 11 Accounts Receivable, Net 12 Notes Receivable, Net 13 Inventories 14 Raw Materials 15 Work In Process 16 Finished Goods 17 Other Inventory 18 Other ST Assets 19 Derivative Hedging Assets 20 Deferred Tax Assets 21 Misc ST Assets 22 Total Current Assets 23 Property, Plant Equip, Net 24 Property, Plant Equip 25 Accumulated Depreciation 26 LT Investments Receivables 27 LT Receivables 28 Other LT Assets 29 Total Intangible Assets 30 Goodwill 31 Other Intangible Assets 32 Deferred Tax Assets 33 Derivative Hedging Assets 34 Investments in Affiliates 35 Misc LT Assets 36 Total Noncurrent Assets 37 Total Assets 6,460 0 6,460 0 0 0 15,668 0 6,677 0 8,991 0 9,700 0 2,467 0 1,857 0 5,122 0 254 0 1,680 0 18 0 0 0 1,662 0 33,508 0 16,090 0 31,977 0 15,887 0 14,821 0 14,821 0 13,923 0 9,436 0 6,615 0 2,821 0 2,489 0 87 0 246 0 1,665 0 44,834 0 78,342 0 1,682 0 31,967 0 15,322 0 31,940 0 16,618 0 14,585 0 14,585 0 12,830 0 8,369 0 6,020 0 2,349 0 2,790 0 33 0 249 0 1,389 0 42,737 0 74,704 0 1,772 0 36,244 0 14,155 0 31,538 0 17,383 0 14,532 0 14,532 0 12,031 0 8,311 0 6,200 0 2,111 0 1,693 0 14 0 243 0 1,770 0 40,718 0 76,962 0 1,765 0 38,603 0 13,574 0 29,781 0 16,207 0 14,447 0 14,447 0 11,885 0 8,114 0 6,217 0 1,897 0 1,439 0 43 0 1,739 0 39,193 0 13,528 0 29,841 00 16,313 0 13,844 0 13,844 0 11,888 0 7,761 0 6,196 0 1,565 0 1,411 0 32 0 2,289 0 39,906 0 78,509 0 2,684 0 39,260 0 78,453 0 38 11,832 0 5,957 0 0 0 10,525 0 5,023 0 0 0 448 0 5,054 0 12,844 0 6,967 0 9,234 0 4,614 0 0 0 452 0 4,168 0 13,965 0 7,303 0 12,641 0 6,487 0 0 0 466 0 5,688 0 11,031 0 4,837 0 13,362 0 7,051 0 0 0 495 0 5,816 0 11,553 0 5,723 0 5,877 0 2,873 0 0 0 56 0 2,817 0 26,242 0 25,169 0 25,092 0 6,662 0 2,933 0 0 0 131 0 2,802 0 26,132 0 22,818 0 22,750 0 68 0 68 0 6,194 0 3,259 0 0 0 91 0 3,168 0 26,931 0 23,847 0 23,770 0 77 0 77 0 5,830 0 3,303 0 0 0 141 0 3,162 0 28,218 0 25,000 0 25,000 0 77 0 77 0 39 Liabilities Shareholders' Equity 40 Payables Accruals 41 Accounts Payable 42 Accrued Taxes 43 Interest Dividends Payable 44 Other Payables Accruals 45 ST Debt 46 ST Borrowings 47 ST Lease Liabilities 48 ST Finance Leases 49 ST Operating Leases 50 Current Portion of LT Debt 51 Other ST Liabilities 52 Deferred Revenue 53 Derivatives Hedging 54 Misc ST Liabilities 55 Total Current Liabilities 56 LT Debt 57 LT Borrowings 58 LT Lease Liabilities 59 LT Finance Leases 60 LT Operating Leases 61 Other LT Liabilities 62 Accrued Liabilities 63 Pension Liabilities 64 Deferred Revenue 65 Derivatives Hedging 66 Misc LT Liabilities 67 Total Noncurrent Liabilities 68 Total Liabilities 69 Preferred Equity and Hybrid Capital 70 Share Capital APIC 71 Common Stock 72 Additional Paid in Capital 73 Treasury Stock 74 Retained Earings 75 Other Equity 76 Equity Before Minority Interest 77 Minority Non Controlling Interest 78 Total Equity 79 Total Liabilities Equity 80 12,046 0 0 0 8,843 0 0 0 0 0 3,203 0 37,215 0 63,457 0 0 0 5,238 0 814 9 4,423 1 17,640 0 29,246 0 2,035 0 14,809 0 76 0 14,885 0 78,342 0 12,541 0 0 0 9,357 0 0 0 36 0 3,148 0 35,359 0 61,491 0 0 0 5,277 0 814 9 4,462 1 17,478 0 27,377 0 2,039 0 13,137 0 76 0 13,213 0 74,704 0 12,418 0 0 0 8,365 0 0 0 2 0 4,051 0 36,265 0 63,196 0 0 0 5,593 0 814 9 4,778 1 17,005 0 26,301 0 1,192 0 13,697 0 69 0 13,766 0 76,962 0 11,211 0 0 0 7,455 0 0 0 9 0 3,747 0 36,211 0 64,429 0 0 0 5,827 0 814 9 5,012 1 20,531 0 30,427 0 1,684 0 14,039 0 41 0 14,080 0 78,509 0 567 0 5,308 0 11,549 0 5,166 0 173 0 0 0 173 0 6,210 0 3,240 0 0 0 71 0 3,169 0 26,621 0 26,742 0 26,281 0 461 0 0 0 461 0 10,461 0 0 0 6,599 0 0 0 0 0 3,862 0 37,203 0 63,824 0 0 0 5,935 0 814 9 5, 120 1 24,217 0 34,437 0 1,567 0 14,588 0 41 0 14,629 0 78,453 0 n2846889 A C D E F G FY 2015 12 31 2015 47,011 0 44,147 0 2,864 0 34,133 0 33,546 0 587 0 12,878 0 0 0 7,971 0 4,951 0 2,119 0 901 0 4,907 0 346 0 442 0 507 0 65 0 173 0 269 0 4,561 0 1,122 0 4 In Millions of USD except Per Share 5 12 Months Ending 6 Revenue 7 Sales Services Revenue 8 Financing Revenue 9 Cost of Revenue 10 Cost of Goods Services 11 Cost of Financing Revenue 12 Gross Profit 13 Other Operating Income 14 Operating Expenses 15 Selling, General Admin 16 Research Development 17 Other Operating Expense 18 Operating Income (Loss) 19 Non Operating (Income) Loss 20 Interest Expense, Net 21 Interest Expense 22 Interest Income 23 Foreign Exch (Gain) Loss 24 Other Non Op (Income) Loss 25 Pretax Income (Loss), Adjusted 26 Abnormal Losses (Gains) 27 Merger Acquisition Expense 28 Abnormal Derivatives 29 Asset Write Down 30 Impairment of Goodwill 31 Impairment of Intangibles 32 Gain Loss on Sale Acquisition of Busine 33 Legal Settlement 34 Restructuring 35 Sale of Investments 36 Other Abnormal Items 37 Pretax Income (Loss), GAAP 38 Income Tax Expense (Benefit) 39 Current Income Tax 40 Deferred me Tax 41 Tax Allowance Credit 42 (Income) Loss from Affiliates 43 Income (Loss) from Cont Ops 44 Net Extraordinary Losses (Gains) 45 Discontinued Operations 46 XO Accounting Changes FY 2016 12 31 2016 38,537 0 35,773 0 2,764 0 28,640 0 28,044 0 596 0 9,897 0 0 0 6,136 0 4,383 0 1,853 0 100 0 3,761 0 1,108 0 431 0 505 0 74 0 57 0 620 0 2,653 0 2,514 0 FY 2017 12 31 2017 45,462 0 42,676 0 2,786 0 31,906 0 31,260 0 646 0 13,556 0 0 0 7,539 0 4,999 0 1,842 0 698 0 6,017 0 461 0 409 0 531 0 122 0 213 0 161 0 5,556 0 1,474 0 FY 2018 12 31 2018 54,722 0 51,822 0 2,900 0 37,719 0 36,997 0 722 0 17,003 0 0 0 7,829 0 5,478 0 1,850 0 501 0 9,174 0 471 0 209 0 404 0 195 0 201 0 61 0 8,703 0 881 0 FY 2019 12 31 2019 53,800 0 50,755 0 3,045 0 37,384 0 36,630 0 754 0 16,416 0 0 0 7,422 0 5,162 0 1,693 0 567 0 8,994 0 478 0 219 0 421 0 202 0 67 0 192 0 8,516 0 704 0 595 0 1 11111 TC 943 0 386 0 236 0 179 0 3,439 0 916 0 1,223 0 307 1,019 0 85 0 985 0 139 0 192 0 623 0 1,256 0 83 0 301 0 4,082 0 3,339 0 2,126 0 ,213 0 495 0 7,822 0 1,698 0 1,478 0 220 0 468 0 7,812 0 1,746 0 1,718 0 28 0 31 28 0 0 0 2,523 0 0 0 0 0 0 0 6 0 59 0 0 0 0 0 0 0 16 0 759 0 0 0 0 0 0 0 24 0 6,148 0 0 0 0 0 0 0 6,094 0 0 0 0 0 0 0 2,523 0 11 0 2,512 0 0 0 0 0 2,512 0 59 0 8 0 67 0 0 0 0 0 67 0 759 0 5 0 754 0 0 0 0 0 754 0 6,148 0 1 0 6,147 0 0 0 0 0 6,147 0 6,094 0 1 0 6,093 0 0 0 0 0 6,093 0 3,215 5 703 5 0 0 1,916 4 1,983 4 0 0 4,122 7 3,368 7 0 0 6,817 3 670 3 0 0 6,451 6 358 6 0 0 47 Income (Loss) Incl MI 48 Minority Interest 49 Net Income, GAAP 50 Preferred Dividends 51 Other Adjustments 52 Net Income Avail to Common, GAAP 53 54 Net Income Avail to Common, Adj 55 Net Abnormal Losses (Gains) 56 Net Extraordinary Losses (Gains) 57 58 Basic Weighted Avg Shares 59 Basic EPS, GAAP 60 Basic EPS from Cont Ops 61 Basic EPS from Cont Ops, Adjusted 62 63 Diluted Weighted Avg Shares 64 Diluted EPS, GAAP 65 Diluted EPS from Cont Ops 66 Diluted EPS from Cont Ops, Adjusted 67 594 3 4 23 4 23 5 41 584 3 0 11 0 11 3 28 591 8 1 27 1 27 6 97 591 4 10 39 10 39 11 53 561 6 10 85 10 85 11 49 601 3 4 18 4 18 5 35 584 3 0 11 0 11 3 28 599 3 1 26 1 26 6 88 599 4 10 26 10 26 11 38 567 5 10 74 10 74 11 37 Suppose we want to calculate the WACC for CAT in 2019 Knowing the equity value is $93,283 M, what is the weight for the cost of debt (Please review Lecture 5 and HW3if needed) 22 28 24 34 16 52 O 29 10 QUESTION 8 Based on the Income statement, what is the average tax rate of CAT in the past THREE years Note In an adjusted income statement, the Profit before tax is Pretax Income (Loss), GAAP 25 49 33 37 58 12 41 95

Question

A D E F G 1 2 Caterpillar Inc (CAT US)   Standardized 3 FY 2015 12 31 2015 FY 2016 12 31 2016 FY 2017 12 31 2017 FY 2018 12 31 2018 FY 2019 12 31 2019 7,168 0 7,168 0 0 0 14,441 0 5,919 0 8,522 0 8,614 0 2,102 0 1,719 0 4,576 0 217 0 1,744 0 62 0 8,261 0 8,261 0 0 0 16,133 0 7,376 0 8,757 0 10,018 0 2,802 0 2,254 0 4,761 0 201 0 1,832 0 60 0 7,857 0 7,857 0 0 0 17,364 0 8,714 0 8,650 0 11,529 0 3,382 0 2,674 0 5,241 0 232 0 1,853 0 88 0 8,284 0 8,284 0 0 0 17,820 0 8,484 0 9,336 0 11,266 0 4,263 0 1,147 0 5,598 0 258 0 1,823 0 84 0 0 0 4  In Millions of USD except Per Share 5 12 Months Ending 6 Total Assets 7   Cash, Cash Equivalents   STI 8   Cash   Cash Equivalents 9   ST Investments 10   Accounts   Notes Receiv 11   Accounts Receivable, Net 12   Notes Receivable, Net 13   Inventories 14   Raw Materials 15   Work In Process 16   Finished Goods 17   Other Inventory 18   Other ST Assets 19   Derivative   Hedging Assets 20   Deferred Tax Assets 21   Misc ST Assets 22 Total Current Assets 23   Property, Plant   Equip, Net 24   Property, Plant   Equip 25   Accumulated Depreciation 26   LT Investments   Receivables 27   LT Receivables 28   Other LT Assets 29   Total Intangible Assets 30   Goodwill 31   Other Intangible Assets 32   Deferred Tax Assets 33   Derivative   Hedging Assets 34   Investments in Affiliates 35   Misc LT Assets 36 Total Noncurrent Assets 37 Total Assets 6,460 0 6,460 0 0 0 15,668 0 6,677 0 8,991 0 9,700 0 2,467 0 1,857 0 5,122 0 254 0 1,680 0 18 0 0 0 1,662 0 33,508 0 16,090 0 31,977 0 15,887 0 14,821 0 14,821 0 13,923 0 9,436 0 6,615 0 2,821 0 2,489 0 87 0 246 0 1,665 0 44,834 0 78,342 0 1,682 0 31,967 0 15,322 0 31,940 0 16,618 0 14,585 0 14,585 0 12,830 0 8,369 0 6,020 0 2,349 0 2,790 0 33 0 249 0 1,389 0 42,737 0 74,704 0 1,772 0 36,244 0 14,155 0 31,538 0 17,383 0 14,532 0 14,532 0 12,031 0 8,311 0 6,200 0 2,111 0 1,693 0 14 0 243 0 1,770 0 40,718 0 76,962 0 1,765 0 38,603 0 13,574 0 29,781 0 16,207 0 14,447 0 14,447 0 11,885 0 8,114 0 6,217 0 1,897 0 1,439 0 43 0 1,739 0 39,193 0 13,528 0 29,841 00 16,313 0 13,844 0 13,844 0 11,888 0 7,761 0 6,196 0 1,565 0 1,411 0 32 0 2,289 0 39,906 0 78,509 0 2,684 0 39,260 0 78,453 0 38 11,832 0 5,957 0 0 0 10,525 0 5,023 0 0 0 448 0 5,054 0 12,844 0 6,967 0 9,234 0 4,614 0 0 0 452 0 4,168 0 13,965 0 7,303 0 12,641 0 6,487 0 0 0 466 0 5,688 0 11,031 0 4,837 0 13,362 0 7,051 0 0 0 495 0 5,816 0 11,553 0 5,723 0 5,877 0 2,873 0 0 0 56 0 2,817 0 26,242 0 25,169 0 25,092 0 6,662 0 2,933 0 0 0 131 0 2,802 0 26,132 0 22,818 0 22,750 0 68 0 68 0 6,194 0 3,259 0 0 0 91 0 3,168 0 26,931 0 23,847 0 23,770 0 77 0 77 0 5,830 0 3,303 0 0 0 141 0 3,162 0 28,218 0 25,000 0 25,000 0 77 0 77 0 39 Liabilities   Shareholders' Equity 40   Payables   Accruals 41   Accounts Payable 42   Accrued Taxes 43   Interest   Dividends Payable 44   Other Payables   Accruals 45   ST Debt 46   ST Borrowings 47   ST Lease Liabilities 48   ST Finance Leases 49   ST Operating Leases 50   Current Portion of LT Debt 51   Other ST Liabilities 52   Deferred Revenue 53   Derivatives   Hedging 54   Misc ST Liabilities 55 Total Current Liabilities 56   LT Debt 57   LT Borrowings 58   LT Lease Liabilities 59  LT Finance Leases 60   LT Operating Leases 61   Other LT Liabilities 62   Accrued Liabilities 63   Pension Liabilities 64   Deferred Revenue 65   Derivatives   Hedging 66   Misc LT Liabilities 67 Total Noncurrent Liabilities 68 Total Liabilities 69   Preferred Equity and Hybrid Capital 70   Share Capital   APIC 71   Common Stock 72   Additional Paid in Capital 73   Treasury Stock 74   Retained Earings 75   Other Equity 76 Equity Before Minority Interest 77   Minority Non Controlling Interest 78 Total Equity 79 Total Liabilities   Equity 80 12,046 0 0 0 8,843 0 0 0 0 0 3,203 0 37,215 0 63,457 0 0 0 5,238 0 814 9 4,423 1 17,640 0 29,246 0  2,035 0 14,809 0 76 0 14,885 0 78,342 0 12,541 0 0 0 9,357 0 0 0 36 0 3,148 0 35,359 0 61,491 0 0 0 5,277 0 814 9 4,462 1 17,478 0 27,377 0  2,039 0 13,137 0 76 0 13,213 0 74,704 0 12,418 0 0 0 8,365 0 0 0 2 0 4,051 0 36,265 0 63,196 0 0 0 5,593 0 814 9 4,778 1 17,005 0 26,301 0  1,192 0 13,697 0 69 0 13,766 0 76,962 0 11,211 0 0 0 7,455 0 0 0 9 0 3,747 0 36,211 0 64,429 0 0 0 5,827 0 814 9 5,012 1 20,531 0 30,427 0  1,684 0 14,039 0 41 0 14,080 0 78,509 0 567 0 5,308 0 11,549 0 5,166 0 173 0 0 0 173 0 6,210 0 3,240 0 0 0 71 0 3,169 0 26,621 0 26,742 0 26,281 0 461 0 0 0 461 0 10,461 0 0 0 6,599 0 0 0 0 0 3,862 0 37,203 0 63,824 0 0 0 5,935 0 814 9 5, 120 1 24,217 0 34,437 0  1,567 0 14,588 0 41 0 14,629 0 78,453 0 n2846889 A C D E F G FY 2015 12 31 2015 47,011 0 44,147 0 2,864 0 34,133 0 33,546 0 587 0 12,878 0 0 0 7,971 0 4,951 0 2,119 0 901 0 4,907 0 346 0 442 0 507 0 65 0 173 0  269 0 4,561 0 1,122 0 4 In Millions of USD except Per Share 5 12 Months Ending 6 Revenue 7   Sales   Services Revenue 8   Financing Revenue 9   Cost of Revenue 10   Cost of Goods   Services 11   Cost of Financing Revenue 12 Gross Profit 13   Other Operating Income 14   Operating Expenses 15   Selling, General   Admin 16   Research   Development 17   Other Operating Expense 18 Operating Income (Loss) 19   Non Operating (Income) Loss 20   Interest Expense, Net 21   Interest Expense 22   Interest Income 23   Foreign Exch (Gain) Loss 24   Other Non Op (Income) Loss 25 Pretax Income (Loss), Adjusted 26   Abnormal Losses (Gains) 27   Merger Acquisition Expense 28   Abnormal Derivatives 29   Asset Write Down 30   Impairment of Goodwill 31   Impairment of Intangibles 32   Gain Loss on Sale Acquisition of Busine 33   Legal Settlement 34   Restructuring 35   Sale of Investments 36   Other Abnormal Items 37 Pretax Income (Loss), GAAP 38   Income Tax Expense (Benefit) 39   Current Income Tax 40   Deferred me Tax 41   Tax Allowance Credit 42   (Income) Loss from Affiliates 43 Income (Loss) from Cont Ops 44   Net Extraordinary Losses (Gains) 45   Discontinued Operations 46   XO   Accounting Changes FY 2016 12 31 2016 38,537 0 35,773 0 2,764 0 28,640 0 28,044 0 596 0 9,897 0 0 0 6,136 0 4,383 0 1,853 0  100 0 3,761 0 1,108 0 431 0 505 0 74 0 57 0 620 0 2,653 0 2,514 0 FY 2017 12 31 2017 45,462 0 42,676 0 2,786 0 31,906 0 31,260 0 646 0 13,556 0 0 0 7,539 0 4,999 0 1,842 0 698 0 6,017 0 461 0 409 0 531 0 122 0 213 0  161 0 5,556 0 1,474 0 FY 2018 12 31 2018 54,722 0 51,822 0 2,900 0 37,719 0 36,997 0 722 0 17,003 0 0 0 7,829 0 5,478 0 1,850 0 501 0 9,174 0 471 0 209 0 404 0 195 0 201 0 61 0 8,703 0 881 0 FY 2019 12 31 2019 53,800 0 50,755 0 3,045 0 37,384 0 36,630 0 754 0 16,416 0 0 0 7,422 0 5,162 0 1,693 0 567 0 8,994 0 478 0 219 0 421 0 202 0 67 0 192 0 8,516 0 704 0     595 0 1 11111 TC       943 0 386 0 236 0 179 0 3,439 0 916 0 1,223 0 307  1,019 0  85 0 985 0 139 0 192 0 623 0 1,256 0  83 0 301 0 4,082 0 3,339 0 2,126 0 ,213 0 495 0 7,822 0 1,698 0 1,478 0 220 0 468 0 7,812 0 1,746 0 1,718 0 28 0 31  28 0 0 0 2,523 0 0 0 0 0 0 0 6 0  59 0 0 0 0 0 0 0  16 0 759 0 0 0 0 0 0 0  24 0 6,148 0 0 0 0 0 0 0 6,094 0 0 0 0 0 0 0 2,523 0 11 0 2,512 0 0 0 0 0 2,512 0  59 0 8 0  67 0 0 0 0 0  67 0 759 0 5 0 754 0 0 0 0 0 754 0 6,148 0 1 0 6,147 0 0 0 0 0 6,147 0 6,094 0 1 0 6,093 0 0 0 0 0 6,093 0 3,215 5 703 5 0 0 1,916 4 1,983 4 0 0 4,122 7 3,368 7 0 0 6,817 3 670 3 0 0 6,451 6 358 6 0 0 47 Income (Loss) Incl  MI 48   Minority Interest 49 Net Income, GAAP 50   Preferred Dividends 51   Other Adjustments 52 Net Income Avail to Common, GAAP 53 54 Net Income Avail to Common, Adj 55 Net Abnormal Losses (Gains) 56 Net Extraordinary Losses (Gains) 57 58 Basic Weighted Avg Shares 59 Basic EPS, GAAP 60 Basic EPS from Cont Ops 61 Basic EPS from Cont Ops, Adjusted 62 63 Diluted Weighted Avg Shares 64 Diluted EPS, GAAP 65 Diluted EPS from Cont Ops 66 Diluted EPS from Cont Ops, Adjusted 67 594 3 4 23 4 23 5 41 584 3  0 11  0 11 3 28 591 8 1 27 1 27 6 97 591 4 10 39 10 39 11 53 561 6 10 85 10 85 11 49 601 3 4 18 4 18 5 35 584 3  0 11  0 11 3 28 599 3 1 26 1 26 6 88 599 4 10 26 10 26 11 38 567 5 10 74 10 74 11 37 Suppose we want to calculate the WACC for CAT in 2019  Knowing the equity value is $93,283 M, what is the weight for the cost of debt  (Please review Lecture 5 and HW3if needed) 22 28  24 34  16 52  O 29 10  QUESTION 8 Based on the Income statement, what is the average tax rate of CAT in the past THREE years   Note  In an adjusted income statement, the Profit before tax is Pretax Income (Loss), GAAP 25 49  33 37  58 12  41 95  A D E F G 1 2 Caterpillar Inc (CAT US)   Standardized 3 FY 2015 12 31 2015 FY 2016 12 31 2016 FY 2017 12 31 2017 FY 2018 12 31 2018 FY 2019 12 31 2019 7,168 0 7,168 0 0 0 14,441 0 5,919 0 8,522 0 8,614 0 2,102 0 1,719 0 4,576 0 217 0 1,744 0 62 0 8,261 0 8,261 0 0 0 16,133 0 7,376 0 8,757 0 10,018 0 2,802 0 2,254 0 4,761 0 201 0 1,832 0 60 0 7,857 0 7,857 0 0 0 17,364 0 8,714 0 8,650 0 11,529 0 3,382 0 2,674 0 5,241 0 232 0 1,853 0 88 0 8,284 0 8,284 0 0 0 17,820 0 8,484 0 9,336 0 11,266 0 4,263 0 1,147 0 5,598 0 258 0 1,823 0 84 0 0 0 4  In Millions of USD except Per Share 5 12 Months Ending 6 Total Assets 7   Cash, Cash Equivalents   STI 8   Cash   Cash Equivalents 9   ST Investments 10   Accounts   Notes Receiv 11   Accounts Receivable, Net 12   Notes Receivable, Net 13   Inventories 14   Raw Materials 15   Work In Process 16   Finished Goods 17   Other Inventory 18   Other ST Assets 19   Derivative   Hedging Assets 20   Deferred Tax Assets 21   Misc ST Assets 22 Total Current Assets 23   Property, Plant   Equip, Net 24   Property, Plant   Equip 25   Accumulated Depreciation 26   LT Investments   Receivables 27   LT Receivables 28   Other LT Assets 29   Total Intangible Assets 30   Goodwill 31   Other Intangible Assets 32   Deferred Tax Assets 33   Derivative   Hedging Assets 34   Investments in Affiliates 35   Misc LT Assets 36 Total Noncurrent Assets 37 Total Assets 6,460 0 6,460 0 0 0 15,668 0 6,677 0 8,991 0 9,700 0 2,467 0 1,857 0 5,122 0 254 0 1,680 0 18 0 0 0 1,662 0 33,508 0 16,090 0 31,977 0 15,887 0 14,821 0 14,821 0 13,923 0 9,436 0 6,615 0 2,821 0 2,489 0 87 0 246 0 1,665 0 44,834 0 78,342 0 1,682 0 31,967 0 15,322 0 31,940 0 16,618 0 14,585 0 14,585 0 12,830 0 8,369 0 6,020 0 2,349 0 2,790 0 33 0 249 0 1,389 0 42,737 0 74,704 0 1,772 0 36,244 0 14,155 0 31,538 0 17,383 0 14,532 0 14,532 0 12,031 0 8,311 0 6,200 0 2,111 0 1,693 0 14 0 243 0 1,770 0 40,718 0 76,962 0 1,765 0 38,603 0 13,574 0 29,781 0 16,207 0 14,447 0 14,447 0 11,885 0 8,114 0 6,217 0 1,897 0 1,439 0 43 0 1,739 0 39,193 0 13,528 0 29,841 00 16,313 0 13,844 0 13,844 0 11,888 0 7,761 0 6,196 0 1,565 0 1,411 0 32 0 2,289 0 39,906 0 78,509 0 2,684 0 39,260 0 78,453 0 38 11,832 0 5,957 0 0 0 10,525 0 5,023 0 0 0 448 0 5,054 0 12,844 0 6,967 0 9,234 0 4,614 0 0 0 452 0 4,168 0 13,965 0 7,303 0 12,641 0 6,487 0 0 0 466 0 5,688 0 11,031 0 4,837 0 13,362 0 7,051 0 0 0 495 0 5,816 0 11,553 0 5,723 0 5,877 0 2,873 0 0 0 56 0 2,817 0 26,242 0 25,169 0 25,092 0 6,662 0 2,933 0 0 0 131 0 2,802 0 26,132 0 22,818 0 22,750 0 68 0 68 0 6,194 0 3,259 0 0 0 91 0 3,168 0 26,931 0 23,847 0 23,770 0 77 0 77 0 5,830 0 3,303 0 0 0 141 0 3,162 0 28,218 0 25,000 0 25,000 0 77 0 77 0 39 Liabilities   Shareholders' Equity 40   Payables   Accruals 41   Accounts Payable 42   Accrued Taxes 43   Interest   Dividends Payable 44   Other Payables   Accruals 45   ST Debt 46   ST Borrowings 47   ST Lease Liabilities 48   ST Finance Leases 49   ST Operating Leases 50   Current Portion of LT Debt 51   Other ST Liabilities 52   Deferred Revenue 53   Derivatives   Hedging 54   Misc ST Liabilities 55 Total Current Liabilities 56   LT Debt 57   LT Borrowings 58   LT Lease Liabilities 59  LT Finance Leases 60   LT Operating Leases 61   Other LT Liabilities 62   Accrued Liabilities 63   Pension Liabilities 64   Deferred Revenue 65   Derivatives   Hedging 66   Misc LT Liabilities 67 Total Noncurrent Liabilities 68 Total Liabilities 69   Preferred Equity and Hybrid Capital 70   Share Capital   APIC 71   Common Stock 72   Additional Paid in Capital 73   Treasury Stock 74   Retained Earings 75   Other Equity 76 Equity Before Minority Interest 77   Minority Non Controlling Interest 78 Total Equity 79 Total Liabilities   Equity 80 12,046 0 0 0 8,843 0 0 0 0 0 3,203 0 37,215 0 63,457 0 0 0 5,238 0 814 9 4,423 1 17,640 0 29,246 0  2,035 0 14,809 0 76 0 14,885 0 78,342 0 12,541 0 0 0 9,357 0 0 0 36 0 3,148 0 35,359 0 61,491 0 0 0 5,277 0 814 9 4,462 1 17,478 0 27,377 0  2,039 0 13,137 0 76 0 13,213 0 74,704 0 12,418 0 0 0 8,365 0 0 0 2 0 4,051 0 36,265 0 63,196 0 0 0 5,593 0 814 9 4,778 1 17,005 0 26,301 0  1,192 0 13,697 0 69 0 13,766 0 76,962 0 11,211 0 0 0 7,455 0 0 0 9 0 3,747 0 36,211 0 64,429 0 0 0 5,827 0 814 9 5,012 1 20,531 0 30,427 0  1,684 0 14,039 0 41 0 14,080 0 78,509 0 567 0 5,308 0 11,549 0 5,166 0 173 0 0 0 173 0 6,210 0 3,240 0 0 0 71 0 3,169 0 26,621 0 26,742 0 26,281 0 461 0 0 0 461 0 10,461 0 0 0 6,599 0 0 0 0 0 3,862 0 37,203 0 63,824 0 0 0 5,935 0 814 9 5, 120 1 24,217 0 34,437 0  1,567 0 14,588 0 41 0 14,629 0 78,453 0 n2846889 A C D E F G FY 2015 12 31 2015 47,011 0 44,147 0 2,864 0 34,133 0 33,546 0 587 0 12,878 0 0 0 7,971 0 4,951 0 2,119 0 901 0 4,907 0 346 0 442 0 507 0 65 0 173 0  269 0 4,561 0 1,122 0 4 In Millions of USD except Per Share 5 12 Months Ending 6 Revenue 7   Sales   Services Revenue 8   Financing Revenue 9   Cost of Revenue 10   Cost of Goods   Services 11   Cost of Financing Revenue 12 Gross Profit 13   Other Operating Income 14   Operating Expenses 15   Selling, General   Admin 16   Research   Development 17   Other Operating Expense 18 Operating Income (Loss) 19   Non Operating (Income) Loss 20   Interest Expense, Net 21   Interest Expense 22   Interest Income 23   Foreign Exch (Gain) Loss 24   Other Non Op (Income) Loss 25 Pretax Income (Loss), Adjusted 26   Abnormal Losses (Gains) 27   Merger Acquisition Expense 28   Abnormal Derivatives 29   Asset Write Down 30   Impairment of Goodwill 31   Impairment of Intangibles 32   Gain Loss on Sale Acquisition of Busine 33   Legal Settlement 34   Restructuring 35   Sale of Investments 36   Other Abnormal Items 37 Pretax Income (Loss), GAAP 38   Income Tax Expense (Benefit) 39   Current Income Tax 40   Deferred me Tax 41   Tax Allowance Credit 42   (Income) Loss from Affiliates 43 Income (Loss) from Cont Ops 44   Net Extraordinary Losses (Gains) 45   Discontinued Operations 46   XO   Accounting Changes FY 2016 12 31 2016 38,537 0 35,773 0 2,764 0 28,640 0 28,044 0 596 0 9,897 0 0 0 6,136 0 4,383 0 1,853 0  100 0 3,761 0 1,108 0 431 0 505 0 74 0 57 0 620 0 2,653 0 2,514 0 FY 2017 12 31 2017 45,462 0 42,676 0 2,786 0 31,906 0 31,260 0 646 0 13,556 0 0 0 7,539 0 4,999 0 1,842 0 698 0 6,017 0 461 0 409 0 531 0 122 0 213 0  161 0 5,556 0 1,474 0 FY 2018 12 31 2018 54,722 0 51,822 0 2,900 0 37,719 0 36,997 0 722 0 17,003 0 0 0 7,829 0 5,478 0 1,850 0 501 0 9,174 0 471 0 209 0 404 0 195 0 201 0 61 0 8,703 0 881 0 FY 2019 12 31 2019 53,800 0 50,755 0 3,045 0 37,384 0 36,630 0 754 0 16,416 0 0 0 7,422 0 5,162 0 1,693 0 567 0 8,994 0 478 0 219 0 421 0 202 0 67 0 192 0 8,516 0 704 0     595 0 1 11111 TC       943 0 386 0 236 0 179 0 3,439 0 916 0 1,223 0 307  1,019 0  85 0 985 0 139 0 192 0 623 0 1,256 0  83 0 301 0 4,082 0 3,339 0 2,126 0 ,213 0 495 0 7,822 0 1,698 0 1,478 0 220 0 468 0 7,812 0 1,746 0 1,718 0 28 0 31  28 0 0 0 2,523 0 0 0 0 0 0 0 6 0  59 0 0 0 0 0 0 0  16 0 759 0 0 0 0 0 0 0  24 0 6,148 0 0 0 0 0 0 0 6,094 0 0 0 0 0 0 0 2,523 0 11 0 2,512 0 0 0 0 0 2,512 0  59 0 8 0  67 0 0 0 0 0  67 0 759 0 5 0 754 0 0 0 0 0 754 0 6,148 0 1 0 6,147 0 0 0 0 0 6,147 0 6,094 0 1 0 6,093 0 0 0 0 0 6,093 0 3,215 5 703 5 0 0 1,916 4 1,983 4 0 0 4,122 7 3,368 7 0 0 6,817 3 670 3 0 0 6,451 6 358 6 0 0 47 Income (Loss) Incl  MI 48   Minority Interest 49 Net Income, GAAP 50   Preferred Dividends 51   Other Adjustments 52 Net Income Avail to Common, GAAP 53 54 Net Income Avail to Common, Adj 55 Net Abnormal Losses (Gains) 56 Net Extraordinary Losses (Gains) 57 58 Basic Weighted Avg Shares 59 Basic EPS, GAAP 60 Basic EPS from Cont Ops 61 Basic EPS from Cont Ops, Adjusted 62 63 Diluted Weighted Avg Shares 64 Diluted EPS, GAAP 65 Diluted EPS from Cont Ops 66 Diluted EPS from Cont Ops, Adjusted 67 594 3 4 23 4 23 5 41 584 3  0 11  0 11 3 28 591 8 1 27 1 27 6 97 591 4 10 39 10 39 11 53 561 6 10 85 10 85 11 49 601 3 4 18 4 18 5 35 584 3  0 11  0 11 3 28 599 3 1 26 1 26 6 88 599 4 10 26 10 26 11 38 567 5 10 74 10 74 11 37 Suppose we want to calculate the WACC for CAT in 2019  Knowing the equity value is $93,283 M, what is the weight for the cost of debt  (Please review Lecture 5 and HW3if needed) 22 28  24 34  16 52  O 29 10  QUESTION 8 Based on the Income statement, what is the average tax rate of CAT in the past THREE years   Note  In an adjusted income statement, the Profit before tax is Pretax Income (Loss), GAAP 25 49  33 37  58 12  41 95

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A D E F G 1 2 Caterpillar Inc (CAT US) - Standardized 3 FY 2015 12/31/2015 FY 2016 12/31/2016 FY 2017 12/31/2017 FY 2018

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