Question
Find the cash flow from investing activities for the year 2018 ABC Inc. Dec. 31 st Balance Sheets ($M) 2018 2017 Cash 200 240 Marketable
Find the cash flow from investing activities for the year 2018
ABC Inc. Dec. 31st Balance Sheets ($M) | ||
| 2018 | 2017 |
Cash | 200 | 240 |
Marketable securities (Short-term Investments)
| 0 | 160 |
Accounts receivable
| 2,000 | 1,520 |
Inventories | 4,000 | 3,280 |
Total current assets | 6,200 | 5,200
|
Net plant and equipment | 8,000 | 6,800
|
Total Assets | 14,200
| 12,000
|
|
|
|
Accounts payable | 800 | 760 |
Notes payable | 1,120 | 520 |
Accruals | 1,200 | 1,120 |
Total current liabilities | 3,120 | 2,400 |
Lon-term bonds | 4,800 | 4,000
|
Total liabilities | 7,920 | 6,400
|
Preferred stock | 400 | 400 |
Common stock | 2,000 | 2,000 |
Retained earnings | 3,880 | 3,200 |
Total common equity | 5,880 | 5,200 |
Total liabilities and equity | 14,200 | 12,000 |
ABC Inc. Dec. 31st Income Statement ($M) | ||
| 2018 | 2017 |
Net sales | 20,000 | 19,040 |
Costs of goods sold | 15,200 | 14,240 |
Depreciation | 800 | 680 |
Other operating expenses | 2,000 | 1,920 |
Earnings before interest and taxes (EBIT) | 2,000 | 2,200 |
Less interest | 480 | 400 |
Earnings before taxes | 1,520 | 1,800 |
Taxes (40%) | 608 | 720 |
Net Income | 912 | 1080
|
Preferred dividends | 32 | 32 |
Net income available to common stock holders | 880 | 1,048 |
| ||
Additional information |
|
|
Stock price per share ($) | 108 | 192 |
Number of preferred shares | 4,000,000 | 4,000,000 |
Number of common shares | 200,000,000 | 200,000,000 |
Common dividends ($M) | 200 | 192 |
Weighted average cost of capital (WACC) | 10% |
|
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