Powell Panther Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) 2014 2013 Sales Operating costs excluding depreciation and amortization EBITDA Depreciation & amortization Earnings before interest and taxes (EBIT) Interest Earnings before taxes (EBT) Taxes (40%) Net income 2000 1.020,0 $ 180,0 30.0 $ 150,0 21.7 $ 128.3 51.3 $ 77.0 $1,000,0 8500 $ 150,0 25.0 5 125.0 20.2 $ 104.8 41.9 $ 62.9 Common dividends $ 60.5 46.4 Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars) 2014 2013 Assets Cash and equivalents Accounts receivable Inventories Total current assets Net plant and equipment Total assets $ 12,0 180.0 180.0 $3720 3000 $6720 $ 10,0 150.0 2000 $360.0 250.0 $610.0 Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars) 2014 2013 Liabilities and Equity Accounts payable $108. S 90.0 Accruals 72.0 GOLD Notes payable 670 Total current liabilities $247.0 52015 Long-term bonds 150.0 1500 Total liabilities 53970 53515 Common stock 50 million shares) 50.0 500 Retained earnings 2250 2005 Common equity 5275.0 Total liabilities and equity 5672.0 5610D RO a. What was Powell Panther Corparation's (Balance sheet and Income Statement are given above) net operating working capital for 2013 and 2014? (10 Points) b. What was Powell Panther Corparation's the 2014 free cash flow? (20 Points) c. How much of the FCF did Powell Panther Corparation's use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (20 Points) (Show your solutions step by step) 2. The H.R. Pickett Corp. has $500,000 of interest-bearing debt outstanding, and it pays an annual interest rate of 10%. In addition, it has $700,000 of common stock on its balance sheet. It finances with only debt and common equity, so it has no preferred stock. Its annual sales are $2 million, its average tax rate is 30%, and its profit margin is 5%. What are its TIE ratio and its return on invested capital (ROIC)? (25 Points) (Show your solutions step by step) 3. If you deposit $10,000 in a bank account that pays 10% interest annually how much will be in your account after 5 years? (You can use your financial calculator (5 Points) 4. What is the present value of a security that will pay $5,000 (FV) in 20 years if securities of equal risk pay 7% annually? (You can use your financial calculator) (5 Points) 5. Your parents will retire in 18 years. They currently have $250,000 saved, and they think they will need $1,000,000 at retirement, What annual interest rate must they earn to reach their goal. assuming they don't save any additional funds? (You can use your financial calculator) (5 Points) 6. A firm's bonds have a maturity of 10 years with a $1,000 face value, have an 8% semiannual coupon, are callable in 5 years at $1,050, and currently sell at a price of $1,100. What are their yield to maturity and their yield to call? (You can use your financial calculator) (10 Points) Powell Panther Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) 2014 2013 Sales Operating costs excluding depreciation and amortization EBITDA Depreciation & amortization Earnings before interest and taxes (EBIT) Interest Earnings before taxes (EBT) Taxes (40%) Net income 2000 1.020,0 $ 180,0 30.0 $ 150,0 21.7 $ 128.3 51.3 $ 77.0 $1,000,0 8500 $ 150,0 25.0 5 125.0 20.2 $ 104.8 41.9 $ 62.9 Common dividends $ 60.5 46.4 Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars) 2014 2013 Assets Cash and equivalents Accounts receivable Inventories Total current assets Net plant and equipment Total assets $ 12,0 180.0 180.0 $3720 3000 $6720 $ 10,0 150.0 2000 $360.0 250.0 $610.0 Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars) 2014 2013 Liabilities and Equity Accounts payable $108. S 90.0 Accruals 72.0 GOLD Notes payable 670 Total current liabilities $247.0 52015 Long-term bonds 150.0 1500 Total liabilities 53970 53515 Common stock 50 million shares) 50.0 500 Retained earnings 2250 2005 Common equity 5275.0 Total liabilities and equity 5672.0 5610D RO a. What was Powell Panther Corparation's (Balance sheet and Income Statement are given above) net operating working capital for 2013 and 2014? (10 Points) b. What was Powell Panther Corparation's the 2014 free cash flow? (20 Points) c. How much of the FCF did Powell Panther Corparation's use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (20 Points) (Show your solutions step by step) 2. The H.R. Pickett Corp. has $500,000 of interest-bearing debt outstanding, and it pays an annual interest rate of 10%. In addition, it has $700,000 of common stock on its balance sheet. It finances with only debt and common equity, so it has no preferred stock. Its annual sales are $2 million, its average tax rate is 30%, and its profit margin is 5%. What are its TIE ratio and its return on invested capital (ROIC)? (25 Points) (Show your solutions step by step) 3. If you deposit $10,000 in a bank account that pays 10% interest annually how much will be in your account after 5 years? (You can use your financial calculator (5 Points) 4. What is the present value of a security that will pay $5,000 (FV) in 20 years if securities of equal risk pay 7% annually? (You can use your financial calculator) (5 Points) 5. Your parents will retire in 18 years. They currently have $250,000 saved, and they think they will need $1,000,000 at retirement, What annual interest rate must they earn to reach their goal. assuming they don't save any additional funds? (You can use your financial calculator) (5 Points) 6. A firm's bonds have a maturity of 10 years with a $1,000 face value, have an 8% semiannual coupon, are callable in 5 years at $1,050, and currently sell at a price of $1,100. What are their yield to maturity and their yield to call? (You can use your financial calculator) (10 Points)