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FREE CASH FLOW Financial information for Powell Panther Corporation is shown below: Powell Panther Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)
FREE CASH FLOW
Financial information for Powell Panther Corporation is shown below:
Powell Panther Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)
2016 | 2015 | |||||
Sales | $2,875.0 | $2,500.0 | ||||
Operating costs excluding depreciation and amortization | 2,300.0 | 2,125.0 | ||||
EBITDA | $575.0 | $375.0 | ||||
Depreciation and amortization | 84.0 | 68.0 | ||||
Earnings before interest and taxes (EBIT) | $491.0 | $307.0 | ||||
Interest | 63.0 | 55.0 | ||||
Earnings before taxes (EBT) | $428.0 | $252.0 | ||||
Taxes (40%) | 171.2 | 100.8 | ||||
Net income |
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Common dividends |
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Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars)
2016 | 2015 | |||||
Assets | ||||||
Cash and equivalents | $46.0 | $38.0 | ||||
Accounts receivable | 275.0 | 250.0 | ||||
Inventories | 575.0 | 500.0 | ||||
Total current assets | $896.0 | $788.0 | ||||
Net plant and equipment | 844.0 | 675.0 | ||||
Total assets |
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Liabilities and Equity | ||||||
Accounts payable | $248.0 | $225.0 | ||||
Accruals | 228.0 | 175.0 | ||||
Notes payable | 58.0 | 50.0 | ||||
Total current liabilities | $534.0 | $450.0 | ||||
Long-term bonds | 575.0 | 500.0 | ||||
Total liabilities | $1,109.0 | $950.0 | ||||
Common stock | 560.2 | 468.0 | ||||
Retained earnings | 70.8 | 45.0 | ||||
Common equity | $631.0 | $513.0 | ||||
Total liabilities and equity |
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Write out your answers completely. For example, 25 million should be entered as 25,000,000.
- What was net operating working capital for 2015 and 2016? 2015: $ 2016: $
- What was the 2016 free cash flow? $
- How would you explain the large increase in 2016 dividends?
- The large increase in net income from 2015 to 2016 explains the large increase in 2016 dividends.
- The large increase in free cash flow from 2015 to 2016 explains the large increase in 2016 dividends.
- The large increase in EBIT from 2015 to 2016 explains the large increase in 2016 dividends.
- The large increase in sales from 2015 to 2016 explains the large increase in 2016 dividends.
- The large increase in retained earnings from 2015 to 2016 explains the large increase in 2016 dividends.
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