Lutters 2013 capital spending was $241 million.

Lutters 2012 working capital was $350 million.

Lutters 2013 weighted average shares outstanding were 340 million.

Lutters stable weighted average cost of capital is 6.6%.

Lutters stable growth rate is 2.7%.

Equity risk premium is 5.5% and Cost of debt is 4%.

Kimball prefers to use the free cash flow to the firm (FCFF) model to value Lutter Corporation.

2. Using Lutters 2013 net income, calculate Lutters 2013 FCFF.

1. $983 million
2. $1,034 million
3. $1,310 million
4. $1,423 million

Consolidated Statement of Income Consolidated Balance Sheet Year ending December 31, 2013 (Dollars in millions) (Dollars in millions) 8712 Assets Revenues Costs and expenses Cost of goods sold Selling, administrative, and general expenses Depreciation Total Operating Expenses Operating income Other (income) expense Interest and investment income Interest expense Gains from foreign currency, net Current assets 5,064 Cash 1,718Accounts receivable 1,125 1,081 341Inventories 7,123Prepaid expenses 1,589Total current assets 1,253 187 3,646 Plant assets 863 2,864 3,727 1,670 2,057 2,842 8,545 (28)Land and buildings 411 Machinery and equipment Gross Less accumulated depreciation Income before taxes Taxes on income Net income 1,214 Net plant assets 414Goodwill and other intangibles 800Total assets Liabilities and shareholders' equity Current liabilities Notes payable Current portion of long-term debt Accounts payable Accrued compensation Accrued liabilities Income taxes pavable Total current liabilities Long-term debt Other liabilities Total liabilities Shareholders' equi Common shares $0.25 par value Issued: 2013 - 431,198,322 shares Capital in excess of par value Treasury stock, at cost 79,152,127 shares Retained earnings Total shareholders' equit Total liabilities and shareholders' equit 425 1,065 51 591 327 2,470 4,503 7.286 108 403 (2,928 3,676 1,259 8,545