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Free Cash Flows Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) 2018 2017 Sales $2,500.0 $2,000.0 Operating costs excluding depreciation 2,063.0
Free Cash Flows
Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)
2018 | 2017 | ||
Sales | $2,500.0 | $2,000.0 | |
Operating costs excluding depreciation | 2,063.0 | 1,700.0 | |
Depreciation and amortization | 53.0 | 48.0 | |
Earnings before interest and taxes | $384.0 | $252.0 | |
Less Interest | 54.0 | 43.0 | |
Pre-tax income | $330.0 | $209.0 | |
Taxes (40%) | 132.0 | 83.6 | |
Net income available to common stockholders | $198.0 | $125.4 | |
Common dividends | $178.0 | $100.0 |
Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)
2018 | 2017 | ||
Assets | |||
Cash | $30.0 | $24.0 | |
Short-term investments | 13.0 | 10.0 | |
Accounts receivable | 275.0 | 220.0 | |
Inventories | 374.0 | 340.0 | |
Total current assets | $692.0 | $594.0 | |
Net plant and equipment | 528.0 | 480.0 | |
Total assets | $1,220.0 | $1,074.0 | |
Liabilities and Equity | |||
Accounts payable | $250.0 | $200.0 | |
Accruals | 69.0 | 60.0 | |
Notes payable | 50.0 | 40.0 | |
Total current liabilities | $369.0 | $300.0 | |
Long-term debt | 500.0 | 400.0 | |
Total liabilities | $869.0 | $700.0 | |
Common stock | 293.0 | 336.0 | |
Retained earnings | 58.0 | 38.0 | |
Total common equity | $351.0 | $374.0 | |
Total liabilities and equity | $1,220.0 | $1,074.0 |
Using Rhodes Corporation's financial statements (shown above), answer the following questions.
- What is the net operating profit after taxes (NOPAT) for 2018? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to one decimal place. $ million
- What are the amounts of net operating working capital for both years? Enter your answers in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answers to the nearest whole number. 2018: $ million 2017: $ million
- What are the amounts of total net operating capital for both years? Enter your answers in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answers to the nearest whole number. 2018: $ million 2017: $ million
- What is the free cash flow for 2018? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Cash outflow, if any, should be indicated by a minus sign. Round your answer to one decimal place. $ million
- What is the ROIC for 2018? Round your answer to two decimal places. %
- How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.
After-tax interest payment $ million Reduction (increase) in debt $ million Payment of dividends $ million Repurchase (Issue) stock $ million Purchase (Sale) of short-term investments $ million
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