Question
South Sea Baubles has the following (incomplete) balance sheet and income statement. BALANCE SHEET AT END OF YEAR (Figures in $ millions) Assets 2015 2016
South Sea Baubles has the following (incomplete) balance sheet and income statement.
BALANCE SHEET AT END OF YEAR | ||||||||||||||
(Figures in $ millions) | ||||||||||||||
Assets | 2015 | 2016 | Liabilities and Shareholders' Equity | 2015 | 2016 | |||||||||
Current assets | $ | 90 | $ | 140 | Current liabilities | $ | 50 | $ | 60 | |||||
Net fixed assets | 800 | 900 | Long-term debt | 600 | 750 | |||||||||
INCOME STATEMENT, 2016 | |||
(Figures in $ millions) | |||
Revenue | $ | 1,950 | |
Cost of goods sold | 1,030 | ||
Depreciation | 350 | ||
Interest expense | 240 | ||
a&b. What is shareholders equity in 2015 and 2016? (Enter your answers in millions.)
c&d. What is net working capital in 2015 and 2016? (Enter your answers in millions.)
e. What are taxes paid in 2016? Assume the firm pays taxes equal to 35% of taxable income. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)
f. What is cash provided by operations during 2016? (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)
g. Net fixed assets increased from $800 million to $900 million during 2016. What must have been South Seas grossinvestment in fixed assets during 2016? (Enter your answer in millions.)
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