Excel Activity: Financial Statements, Cash Flow, and Taxes Laiho Industries's 2020 and 2021 balance sheets (in thousands of dollars) are shown. Laiho Industries: Balance Sheets as of December 31 (thousands of dollars) 2020 $ 90,945 83,629 35,429 Cash Accounts receivable Inventories Total current assets Net fixed assets Total assets Accounts payable Accruals Notes payable Total current liabilities Long-term debt Total liabilities Common stock Retained earnings Total common equity Total liabilities and equity 2021 $105,844 99,698 39,186 $244,728 66,523 $311,251 $ 31,132 31,293 14,638 $ 77,063 73,705 $150,768 102,500 57,983 $160,483 $311,251 $210,003 41,378 $251,381 $ 24,110 22,687 12,388 $ 59,185 62,355 $121,540 90,000 39,841 $129,841 $251,381 The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required analysis to answer the questions below. Do not round intermediate calculations. Enter your answers in thousands. For example, an answer of $1 thousand should be entered as 1, not 1,000. Round your answers to the nearest whole number. Use a minus sign to enter negative values, if any. X Download spreadsheet Financial Statements, Cash Flow, and Taxes-aca825.xlsx a. Sales for 2021 were $461,150,000, and EBITDA was 14% of sales. Furthermore, depreciation and amortization were 17% of net fixed assets, interest was $8,248,000, the corporate tax rate was 25%, and Laiho pays 46.25% of its net income as dividends. Given this information, construct the firm's 2021 income statement. Laiho Industries: Income Statement for Year Ending December 31, 2021 (thousands of dollars) Sales Operating costs excluding depreciation and amortization EBITDA Depreciation and amortization EBIT Interest EBT Taxes (25%) Net income $ $ 2021 Common dividends Addition to retained earnings b. Construct the statement of stockholders' equity for the year ending December 31, 2021, and the 2021 statement of cash flows. Hint: The difference in accumulated depreciation from one year to the next is the annual depreciation expense for the year. Laiho Industries: Statement of Stockholders' Equity, December 31, 2021 (thousands of dollars) Common Stock Retained Earnings Balances, December 31, 2020 Common stock issue. 2021 Net income Cash dividends Addition to retained earnings Balances, December 31, 2021 S $ $ Operating Activities Net income Depreciation and amortization Increase accounts payable Increase in accruals $ Laiho Industries: Statement of Cash Flows for 2021 (thousands of dollars) 2021 Total Stockholders' Equity $ Increase in inventories Net cash provided by operating activities Investing Activities Additions to property, plant, and equipment Net cash used in investing activities Financing Activities Increase in notes payable Increase in long-term debt Increase in common stock Payment of common dividends Net cash provided by financing activities Summary thousand $ $ thousand +A Net increase/decrease in cash Cash at the beginning of the year Cash at the end of the year c. Calculate 2020 and 2021 net operating working capital (NOWC) and 2021 free cash flow (FCF). Assume the firm has no excess cash. NOWC2020: $ NOWC2021: $ $ c. Calculate 2020 and 2021 net operating working capital (NOWC) and 2021 free cash flow (FCF). Assume the firm has no excess cash. NOWC2020: $ NOWC2021: $ FCF2021: $ d. If Laiho increased its dividend payout ratio, what effect would this have on corporate taxes paid? What effect would this have on taxes paid by the company's shareholders? corporate taxes and the company's shareholders would pay If Laiho increased its dividend payout ratio, the firm would pay dividends they would receive. e. Assume that the firm's after-tax cost of capital is 10.5%. What is the firm's 2021 EVA? thousand LA thousand thousand thousand f. Assume that the firm's stock price is $20 per share and that at year-end 2021 the firm has 10 million shares outstanding. What is the firm's MVA at year-end 2021? thousand taxes on the 1 Financial Statements, Cash Flow, and Taxes 2 3 Laiho Industries: Balance Sheets as of December 31 4 (in thousands of dollars) 5 6 7 Cash 8 Accounts receivable 9 Inventories Assets 0 Total current assets 1 Net fixed assets 2 Total assets 3 4 Liabilities and equity 5 Accounts payable 6 Accruals 7 Notes payable 8 Total current liabilities 9 Long- debt 20 Total liabilities 21 Common stock 22 Retained earnings 23 Total common equity 24 Total liabilities and equity 25 26 a. Constructing the firm's 2021 income statement 27 28 Laiho Industries: financial information for 2021 29 (in thousands of dollars) 30 31 Sales 32 EBITDA as a percentage of sales 3 Depr. as a % of fixed assets 34 Tax rate 35 Interest expense 36 Dividend payout ratio 37 1 Sales Operating costs excluding depreciation and 2 amortization 3 EBITDA 4 Depreciation and amortization 5 EBIT -6 Interest -7 EBT 8 9 Net Income Taxes (25%) 2021 50 51 Common dividends $105,844 99,698 39,186 $244,728 66,523 $311,251 $31,132 31,293 14,638 $77,063 73,705 $150,768 102,500 57,983 38 Laiho Industries: Income Statement for Year Ending December 31, 2021 39 (in thousands of dollars) -0 $160,483 $311,251 $461,150 14% 17% 25% $8,248 46.25% 2021 2020 $90,945 83,629 35,429 $210,003 41,378 $251,381 $24,110 22,687 12,388 $59,185 62,355 $121,540 90,000 39,841 $129,841 $251,381 Formulas #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A 43 EBITDA 44 Depreciation and amortization 45 EBIT 46 Interest 47 EBT 48 Taxes (25%) 49 Net Income 50 51 Common dividends. 52 Addition to retained eamings 53 56 57 Laiho Industries: Statement of Stockholders' Equity, December 31, 2021 58 (in thousands of dollars) 59 60 Balances, December 31, 2020 61 Common stock issue 62 2021 Net income 63 Cash dividends 64 Addition to retained eamings 65 Balances, December 31, 2021 66 67 Laiho Industries: Statement of Cash Flows for 2021 68 (in thousands of dollars) 69 Operating Activities 70 Net income 71 Depreciation and amortization 72 Increase in accounts payable 73 Increase in accruals 74 Increase in accounts receivable 75 Increase in inventories 76 77 78 Investing Activities 79 Additions to property, plant, and equipment 80 Net cash used in investing activities 54 b. Constructing the statement of stockholders' equity for the year ending December 31, 2021, 55 and the 2021 statement of cash flows Net cash provided by operating activities 81 82 Financing Activities 83 Increase in notes payable 84 Increase in long-term debt Sheet1 Common Stock + #N/A #N/A #N/A 2021 #N/A #N/A #N/A #N/A #N/A #N/A Retained Earnings Formulas #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A Total Stockholders' Equity #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A 76 Net cash provided by operating activities 77 78 Investing Activities 79 Additions to property, plant, and equipment 80 Net cash used in investing activities 81 82 Financing Activities 83 Increase in notes payable 84 Increase in long-term debt 85 Increase in common stock 86 Payment of common dividends 87 Net cash provided by financing activities 88 89 Summary 90 Net increase/decrease in cash 91 Cash at the beginning of the year 92 Cash at the end of the year 96 NOWC2020 (in thousands of dollars) 97 NOWC2021 (in thousands of dollars) 98 FCF 2021 (in thousands of dollars) 99 00 e. Calculating the firm's 2021 EVA 01 After-tax cost of capital 02 EVA2021 (in thousands of dollars) 03 04 f. Calculating the firm's MVA at year-end 2021 05 Stock price 06 Shares outstanding 93 94 c. Calculating 2020 and 2021 net operating working capital (NOWC) and 2021 free cash flow (FCF) 95 Excesss cash $0 07 MVA2021 (in thousands of dollars) 08 09 10 11 10.5% #N/A $20 10,000 #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A