Example: HO# (2) The financial statements of Flathead Manufacturing Company are shown below: Flathead Lake Manufacturing Income Statement 2012 Sales $9,300,000 Cost of Goods Sold 5,750,000 Depreciation Expense 550,000 Gross Profit $3,000,000 Selling and Administrative Expenses 2.200,000 EBIT $ 800,000 Interest Expense 200,000 Income before Tax $ 600,000 Taxes 375,000 Net Income $ 225,000 Flathead Lake Manufacturing Comparative Balance Sheets 2012 2011 Cash $ 50,000 $ 40,000 Accounts Receivable 570,000 600,000 Inventory 530,000 460,000 Total Current Assets $ 1,150,000 $1,100,000 Fixed Assets 2,050,000 1,400,000 Total Assets $3,200,000 $2.500.000 Accounts Payable Bank Loans Total Current Liabilities Long-term Bonds Total Liabilities Common Stock (200,000 shares) Retained Earnings Total Equity Total Liabilities and Equity $ 320,000 $300,000 480,000 400,000 $ 800,000 $ 700,000 1.500.000 1,000,000 $ 2,300,000 $1,700,000 200,000 200,000 700.000 600,000 $ 900.000 $ 800.000 $ 3.200.000 $ 2.500.000 Calculate the following: 1) Net operating profit after taxes 2012 2) Net Operating Working Capital (NOWC) 2012 3) Free Cash Flow (FCF) 2012 if the net Investment in operating capital equal $ 100,000. 4) Return on Invested Capital (ROIC) 2012. 5) Net Operating Working Capital (NOWC) 2011 6) Return on Invested Capital (ROIC) 2011 assuming the Net Income for the year 2011 equal $200,000. 7) Tax Rate 0.625