Assume Apple invested $2.12 billion to expand its manufacturing capacity. Assume that these assets have a 10-year life and that Apple requires a 10% internal rate of return on these assets. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Required 1. What is the amount of annual cash flows that Apple must earn from these projects to have a 10% internal rate of return? (Hint: Identify the 10-period, 10% factor from the present value of an annuity table, and then divide $2.12 billion by this factor to get the annual cash flows necessary.) 2. Access Apple's financial statements for the fiscal year ended September 30, 2017, from Appendix A. a. Determine the amount that Apple invested in capital assets for 2017. Hint: Refer to the statement of cash flows. b. Did Apple invest more in capital assets or in marketable securities for 2017? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the amount of annual cash flows that Apple must earn from these projects to have a 10% internal rate of return? (Hint: Identify the 10-period, 10% factor from the present value of an annuity table, and then divide $2.12 billion by this factor to get the annual cash flows necessary.) (Round your answer to the nearest whole dollars.) Annual cash flows per year Required 1 Required 2 Access Apple's financial statements for the fiscal year ended September 30, 2017, from Appendix A. a. Determine the amount that Apple invested in capital assets for 2017. Hint: Refer to the statement of cash flows. (Enter your answer in millions.) b. Did Apple invest more in capital assets or in marketable securities for 2017? Show less a. Amount invested in capital assets million Did Apple invest more in capital assets or in marketable securities for 2017? b. Assume that Google invests $2.42 billion in capital expenditures, including $1.08 billion related to manufacturing capacity. Assume that these projects have a seven-year life and that management requires a 15% internal rate of return on those projects. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Required 1. What is the amount of annual cash flows that Google must earn from those expenditures to achieve a 15% internal rate of return? (Hint Identify the seven-period, 15% factor from the present value of an annuity table and then divide $1.08 billion by the factor to get the annual cash flows required.) 2. Refer to the financial statements in Appendix A. Identify the amount that Google invested in capital assets for the year ended December 31, 2017 3. Did Google or Apple invest more in capital assets for 2017? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the amount of annual cash flows that Google must earn from those expenditures to achieve a 15% internal rate of return? (Hint: Identify the seven-period, 15% factor from the present value of an annuity table and then divide $1.08 billion by the factor to get the annual cash flows required.) (Round your answer to the nearest whole dollar.) Annual cash flows per year Required 1 Required 2 Required 3 Refer to the financial statements in Appendix A. Identify the amount that Google invested in capital assets for the year ended December 31, 2017. (Enter your answer in millions.) Amount invested in capital assets million Google Inc. (Alphabet Inc.)a CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) 2015 2016 2017 $ 16,348 $ 19,478 $ 12,662 6,103 812 7,679 4,132 931 5,203 (179) 334 212 5,267 877 6,703 (38) 275 174 258 194 137 (2,578) 3,125 (3,768) 8,211 Year Ended December 31 Operating activities Net income Adjustments: Depreciation and impairment of property and equipment Amortization and impairment of intangible assets Stock-based compensation expense Deferred income taxes Loss on marketable and non-marketable investments, net Other Changes in assets and liabilities, net of effects of acquisitions: Accounts receivable Income taxes, net Other assets Accounts payable Accrued expenses and other liabilities Accrued revenue share Deferred revenue Net cash provided by operating activities Investing activities Purchases of property and equipment Proceeds from disposals of property and equipment Purchases of marketable securities Maturities and sales of marketable securities Purchases of non-marketable investments Maturities and sales of non-marketable investments Cash collateral related to securities lending Investments in reverse repurchase agreements Acquisitions, net of cash acquired, and purchases of intangible assets (2,094) (179) (318) 203 1,597 339 312 110 1,515 593 223 36,036 (2,164) 731 4,891 955 390 37,091 43 26,572 (9,950) 35 (74,368) 62,905 (2,326) 154 (350) 425 (236) (10,212) 240 (84,509) 66,895 (1,109) 494 (2,428) 450 (986) (13,184) 99 (92,195) 73,959 (1,745) 533 0 0 (287) 0 (23,711) 1,419 (31,401) (31,165) Proceeds from collection of notes receivable Net cash used in investing activities Financing activities Net payments related to stock-based award activities Adjustment Payment to Class C capital stockholders Repurchases of capital stock Proceeds from issuance of debt, net of costs Repayments of debt Proceeds from sale of subsidiary shares Net cash used in financing activities Effect of exchange rate changes on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period (2,375) (47) (1,780) 13,705 (13,728) 0 (4,225) (434) (1,798) 18,347 16,549 (3,304) 0 (3,693) 8,729 (10,064) 0 (8,332) (170) (3,631) 16,549 12,918 (4,166) 0 (4,846) 4,291 (4,377) 800 (8,298) 405 (2,203) 12,918 10,715 $ $ $ Supplemental disclosures of cash flow information Cash paid for taxes, net of refunds Cash paid for interest, net of amounts capitalized $ $ 1,643 $ 3,651 96 6,191 84 $ $ 84 $ Google is part of Alphabet, but we loosely refer to Alphabet as Google because of its global familiarity and that Google provides 99% of Alphabet's $110,855 billion in revenues. September 26, 2015 $ 13,844 53,394 11,257 3,586 1,382 385 Apple Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) Years ended September 30, 2017 September 24, 2016 Cash and cash equivalents, beginning of the year $ 20,484 $ 21,120 Operating activities: Net income 48,351 45,687 Adjustments to reconcile net income to cash generated by operating activities: Depreciation and amortization 10,157 10,505 Share-based compensation expense 4,840 4,210 Deferred income tax expense 5,966 4,938 Other (166) 486 Changes in operating assets and liabilities: Accounts receivable, net (2,093) Inventories (2,723) 217 Vendor non-trade receivables (4,254) (51) Other current and non-current assets (5,318) 1,055 Accounts payable 9,618 1,837 Deferred revenue (626) (1,554) Other current and non-current liabilities (154) (2,033 Cash generated by operating activities 63,598 65,824 Investing activities: Purchases of marketable securities (159,486) (142,428) Proceeds from maturities of marketable securities 31,775 21,258 Proceeds from sales of marketable securities 94,564 90,536 Payments made in connection with business acquisitions, net (329) (297) Payments for acquisition of property, plant and equipment (12,451) (12,734) Payments for acquisition of intangible assets (344) (814) 527 417 (238) (3,735) (283) 5,001 1,042 9,058 81,266 (166,402) 14,538 107,447 (343) (11,247) (241) (395) 220 (46,446) (1,388) (110) (45,977) (26) (56,274) 555 495 543 749 Payments for strategic investments, net Other Cash used in investing activities Financing activities: Proceeds from issuance of common stock Excess tax benefits from equity awards Payments for taxes related to net share settlement of equity awards Payments for dividends and dividend equivalents Repurchases of common stock Proceeds from issuance of term debt, net Repayments of term debt Change in commercial paper, net Cash used in financing activities Increase (decrease) in cash and cash equivalents Cash and cash equivalents, end of the year (1,499) (11,561) (35,253) 27,114 627 (1,874) (12,769) (32,900) 28,662 (3,500) 3,852 (17,347) (195) 20,289 407 (1,570) (12,150) (29,722) 24,954 (2,500) (397) (20,483) (636) 20,484 2,191 (17,716) 7,276 21,120 $ $ $ Supplemental cash flow disclosure: Cash paid for income taxes, net Cash paid for interest $ $ $ 11,591 2,092 10,444 1,316 13,252 514 $ $ $