Problem 1 Mary Chia Holdings Ltd.'s financial statements (pesos and shares are in millions) are

provided.

Balance Sheets as of December 31

2020 2019

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Assets

Cash and equivalents P 14,000 P 13,000

Accounts receivable 30,000 25 000

Inventories 28,125 21,000

Total current assets P 72,125 P 59,000

Net plant and equipment 50,000 47,000

Total assets P122,125 P106,000

Liabilities and Equity

Accounts payable P$ 10,800 P 9,000

Notes payable 6,700 5,150

Accruals 7,600 6,000

Total current liabilities P 25,100 P 20,150

Long-term bonds 15,000 15,000

Total debt 40,100 35,150

Common stock (5,000 shares) 50,000 50,000

Retained earnings 32,025 20,850

Common equity 82,025 70,850

Total liabilities and equity P122,125 P106,000

Rncome Statement for Year Ending December 31, 2020

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Sales P214,000

Operating costs excluding depreciation and amortization 170,000

EBITDA P 44,000

Depreciation & amortization 5,000

EBIT P 39,000

Interest 1,750

EBT P 37,250

Taxes (40%) 14,900

Net income P 22,350

Dividends paid P 11,175

a. What was the net working capital for 2019 and 2020?

b. What was Mary Chia Holding's 2020 free cash flow?

c. Construct Mary Chia Holding's 2020 statement of stockholder's equity.