Lan & Chen Technologies: Income Statements for Year Ending December 31
(Thousands of Dollars)				2015		2014
Sales				$945,000		$900,000
Operating costs excluding depreciation and amortization				812,700		774,000
EBITDA				$132,300		$126,000
Depreciation				33,100		31,500
EBIT				$99,200		$94,500
Interest Expense				10,470		8,600
EBT				$88,730		$85,900
Taxes (40%)				35,492		34,360
Net income				$53,238		$51,540
Lan & Chen Technologies: December 31 Balance Sheets
(Thousands of Dollars)
Assets		2015			2014
Cash		$47,250			$45,000
Short-term investments		3,800			3,600
Accounts Receivable		283,500			270,000
Inventories		141,750			135,000
Total current assets		$476,300			$453,600
Net fixed assets		330,750			315,000
Total assets		$807,050			$768,600
Liabilities and equity
Accounts payable		$94,500			$90,000
Accruals		47,250			45,000
Notes payable		26,262			9,000
Total current liabilities		$168,012			$144,000
Long-term debt		94,500			90,000
Total liabilities		$262,512			$234,000
Common stock		444,600			444,600
Retained Earnings		99,938			90,000
Total common equity		$544,538			$534,600
Total liabilities and equity		$807,050			$768,600

a. Using the given information calculate Lan & Chen Technologies Free Cash Flow (FCF) and Return on Invested Capital Ratio (ROIC) in year 2015 (i.e., Calculate FCF2015 & ROIC2015).

b. Assume you are in a job interview and they ask you Why is FCF important for shareholders?. Give a short (2-4 sentences) explanation.

c. How much dividend did the firm pay in year 2015?

d. Forecast the next four years FCF using 2015 actual data. Assume operating ratios remain unchanged from values in most recent year and sales will grow by 8%, 8%, 6%, and 5% for the next four years (i.e., calculate FCF2016, FCF2017, FCF2018, FCF2019).