Powell Panther Corporation: Income Statements for Year Ending December $31($Millions of Dollars$)$

Powell Panther Corporation: Balance Sheets as of December $31($Millions of Dollars$)$

$2018$

$2017$

Assets

Cash and equivalents

Accounts receivable

Inventories

Total current assets

Net plant and equipment

Total assets

Liabilities and Equity

Accounts payable

Accruals

Notes payable

Total current liabilities

Long$-$term bonds

Total liabilities

Common stock

Retained earnings

Common equity

Total liabilities and equity

Write out your answers completely. For example, $25$ million should be entered as $25,000,000.$ Round your answers to

nearest dollar, if necessary. Negative values, if any, should be indicated by a minus sign.

a$.$ What was net operating working capital for $2017$ and $2018?$ Assume the firm has no excess cash.

$2017$: $

$2018$: $

b$.$ What was the $2018$ free cash flow?

$

c$.$ How would you explain the large increase in $2018$ dividends?

I. The large increase in net income from $2017$ to $2018$ explains the large increase in $2018$ dividends.

II$.$ The large increase in EBIT from $2017$ to $2018$ explains the large increase in $2018$ dividends.

III. The large increase in sales from $2017$ to $2018$ explains the large increase in $2018$ dividends.

IV$.$ The large increase in free cash flow from $2017$ to $2018$ explains the large increase in $2018$ dividends.

V$.$ The large increase in retained earnings from $2017$ to $2018$ explains the large increase in $2018$ dividends.