FFS 12-2 WestJet is a a Canadian company with clear focus on its employees and customers. Reference the financial statements in Appendix II, particularly the link to the notes, referring to Note 11 and 12. Below are selected sections presented for your review: 11. Share capital (a) Authorized Unlimited number of common voting shares The common voting shares may be owned and controlled only by Canadians and shall confer the right to one vote per common voting share at all meetings of shareholders of the Corporation. If a common voting share becomes beneficially owned or controlled by a person who is not a Canadian, such common voting share shall be converted into one variable voting share automatically and without any further act of the Corporation or the holder (b) Issued and outstanding Common and variable voting shares: 2017 2016 Number Amount Number Amount Balance, beginning of year 117,200,439 555,716 123,086,477 582,796 Issuance of shares pursuant to compensation plans 376,047 10,131 68,911 1,146 Shares repurchased (3,523,597) (16,870) (5,954,949) (28,226) Balance, end of year 114,052,889 548,977 117,200,439 555,716 At December 31, 2017, the number of common voting shares outstanding was 76,918,114 (December 31, 2016-93,972,416) and the number of variable voting shares was 37,134,775 (December 31, 2016-23,228,023). CHAPTER 12 Organization and Operation of Corporations (h) Employee share purchase plan The Corporation has an employee share purchase plan (ESPP), whereby the Corporation matches the contributions made by employees. Under the terms of the ESPP, employees may, dependent on their employment agreement, contribute up to a maximum of 10%, 15% or 20% of their gross salary to acquire voting shares of the Corporation at the current fair market value. The contributions are matched by the Corporation and are required to be held within the ESPP for a period of one year Employees may offer to sell ESPP shares, which have not been held for at least one year, to the Corporation, at a purchase price equal to 50% of the weighted average trading price of the Corporation's voting shares for the five trading days immediately preceding the employee's notice to the Corporation, to a maximum of four times per year. 12. Dividends During the year ended December 31, 2017, the Corporation's Board of Directors declared quarterly cash dividends of $0.14 per common voting share and variable voting share. For the year ended December 31, 2017, the Corporation paid dividends totaling $64,886 (2016-$66,967). Required Using the information provided above, answer the following questions. 1. Identify the total dollar value of dividends declared and paid by West Jet Corporation in fiscal 2017 and 2016. 2. How many common shares are authorized? 3. What is the difference between WestJet common shares and variable voting shares? 4. How many variable voting shares did WestJet have outstanding at the end of 2017, and how many com- mon shares outstanding at the end of 2017. 5. What are dividends? Be sure to include as part of your answer the effect of dividends on equity. 6. How many shares can employees purchase? 7. Why might WestJet offer the shares for employees? 8. On January 1, 2017 Tina owns 1,000 shares that she has accumulated through the employee share purchase plan. Identify WestJet's quarterly dividend rate in their financial statement note 12 and calculate her total dividends received for fiscal 2017, assuming she has not accumulated any further shares over the year. Note 2017 2016 Operating activities: Net earnings Items not involving cash: Depreciation and amortization Change in maintenance provisions 283,578 295,458 403.021 350,484 65,372 82,564 4,807 Amortization of transaction costs 5,092 Amortization of hedge settlements 833 (Gain) loss on derivatives 4,059 (2.472) (Gain) loss on disposal of property and equipment (6.562) 3,314 11 Share-based payment expense 19,050 18,432 Deferred Income tax expense (recovery) 61.912 (12.280) Unrealized foreign exchange (gain) loss 2,496 (4,498) Change in non-cash working capital 237,663 40,384 Change in restricted cash (7,051) (34,076) (1.296) 7.129 6,379 (2.486) (4,784) (7.197) (56,571) (36,094) 1,012,073 704,587 Change in other assets Change in other liabilities Purchase of shares pursuant to compensation plans. Maintenance provision settlements Investing activities: Aircraft additions (881.069) Aircraft disposals (847,718) Other property and equipment and intangible additions and disposals 9,511 4,660 Purchases of marketable securities (48.855) (76.996) (231.293) Change in non-cash working capital (16,009) (22.288) (1.167,715) (942,342) Financing activities: Increase in long-term debt Repayment of long-term debt 186,796 998,715 Shares repurchased Dividends paid (154,249) (157.193) 11 12 12 (90,317) (126,152) Cash interest paid i Change in non-cash working capital Cash flow from/(used in) operating, investing and financing activities Effect of foreign exchange on cash and cash equivalents Net change in cash and cash equivalents Cash and cash equivalents, beginning of year (64,886) (66.967) (63,188) (56,046) (14,597) (14,026) (200,441) 578,331 (356.083) 340,576 (17.663) (3,551) (373,746) 337.025 1,520,822 1,183,797 1,147,076 1,520,822 Cash and cash equivalents, end of year Supplemental disclosure of operating cash flows Cash interest received Cash taxes paid, net 17,634 (97.911) 16,148 (118,014) Revenue: Guest Note 2017 2016 Other Operating expenses: 3,822,045 680,275 4,502,320 3,556,941 565,918 4,122,859 Aircraft fuel Salaries and benefits 950,043 765,867 Rates and fees 935,145 854,056 Depreciation and amortization 644,763 617,573 Sales and marketing 6 403,021 350,484 384,452 Maintenance 356,745 Aircraft leasing 203,227 209,226 165,902 178,445 Other Employee profit share Earnings from operations 330,014 291,024 46,793 59,342 4,063,360 3,682,762 438,960 440,097 Non-operating income (expense): Finance income Finance cost 14 19,626 (53,710) Gain (loss) on foreign exchange 16,618 (49,074) (4.877) 7,402 Gain (loss) on disposal of property and equipment 6,562 (3.314) Gain (loss) on derivatives (2,426) 4,504 (34.825) (23,864) Earnings before income tax 404,135 416,233 Income tax expense (recovery): Current 12 Deferred Net earnings Earnings per share: Basic Diluted 10 58,645 133,055 10 61,912 (12,280) 120,557 120,775 283,578 295,458 13 33 2.44 2.46 2.42 2.45 2017 2016 Note Assets Inventory Current assets: chael Report Cash and cash equivalents Marketable securities Total cash, cash equivalents and marketable securities Restricted cash Accounts receivable Prepaid expenses, deposits and other Non-current assets: Property and equipment Intangible assets Other assets Total assets Liabilities and shareholders' equity Current liabilities: Accounts payable and accrued liabilities Advance ticket sales Deferred rewards program Non-refundable guest credits Current portion of maintenance provisions Current portion of long-term debt Non-current liabilities: Maintenance provisions 1,147,076 1,520,822 226,090 1,373,166 1,520,822 5 109.700 102.649 18 129,648 127,785 18 138,676 181,070 18 43,045 33.535 1,794,235 1,965,861 619 4,567,504 4,036,880 59,517 66,187 18 78,584 95,368 6,499.840 6,164,296 18 549,844 547,490 695,111 626.635 203.433 155.567 Insmalups bris 43.288 42.942 8 82,129 103.571 9 153,149 145,128 1,726,954 1,621,333 Long-term debt Other liabilities 9 01 Deferred Income tax 18 10 0868 270.347 1,895,898 262,663 1,901,530 8.374 19.171 Total abilities 374,946 4,287,316 309.694 4,103,594 Shareholders' equity: Share capital Equity reserves Er 11 Hedge reserves Retained earnings zinam Total shareholders' equity Total liabilities and shareholders' equity The accompanying no 548.977 555,716 97,514 93,039 to neq 1,567,935 (1.902) (11,003) 1,422,950 2,212,524 2.060,702 6,499,840 6,164,296