IV. You are given the balance sheet and income statement of a certain company for 1999: Income Statement ($ in Millions) Balance Sheet ($ in Millions) Assets 1999 Liabilities and 1999 Owners' Equity Current Assets Current Liabilities Cash 200 Accounts Payable 400 Accounts Receivable 400 Notes Payable 400 Inventory 600 Total Current Liabilities 800 Total Current Assets 1200 Long-Term Liabilities Long-Term Debt 500 Fixed Assets Total Long-Term Liabilities soo Net Fixed Assests 900 Owners' Equity Common Stock ($1 Par) 300 Retained Earnings 400 Total Owners' Equity 700 Total Assets 2000 Total Liab. and Owners' 2000 Equity Sales Cost of Goods Sold Taxable income Taxes Net Income Dividends Addition to Retained Eamings 1999 1200 900 300 90 210 70 140 Given that the forecasted sales growth is 25%, construct the 2000 Pro Forma Balance Sheet and Income Statement. III. You are given the balance sheet and income statement below: 1997 150 130 290 Balance Sheet($in Millions) Assets 1998 1997 Liabilities and 1998 Owners' Equity Current Assets Current Liabilities Cash 130 100 Accounts Payable 200 Accounts Receivable 390 300 Notes Payable 170 Inventory 940 700 Total Current 370 Liabilities Total Current Assets 1460 1100 Long-Term Liabilities Long-Term Debt 750 Fixed Assets Total Long-Term 750 Liabilities Property, plant, and 970 800 Owners' Equity Equipment Less Accumulated 266 180 Common Stock ($1 Par) 320 Depreciation Net Fixed Assests 704 620 Capital Surplus 470 Retained Earnings 254 Total Owners' Equity 1044 Total Assets 2164 1720 Total Liab. and Owners' Equity 610 Income Statement ($ in Millions) 1998 Sales 1100 Cost of Goods Sold 600 Administrative Expenses 100 Depreciation 86 Earnings Before Interest and 314 Taxes Interest Expense 40 Taxable Income 274 Taxes 47 Net Income 227 610 300 103 400 Dividends Addition to Retained Earnings 124 130 830 2164 1720 a. Compute for the Operating Cash Flow b. Compute for the Free Cash Flow