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 | $ | 109 | $ | 235 | Current liabilities | $ | 88 | $ | 117 | |||||
Net fixed assets | 990 | 1,090 | Long-term debt | 695 | 940 | |||||||||
INCOME STATEMENT, 2016 | |||
(Figures in $ millions) | |||
Revenue | $ | 2,045 | |
Cost of goods sold | 1,125 | ||
Depreciation | 445 | ||
Interest expense | 259 | ||
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 $990 million to $1,090 million during 2016. What must have been South Seas gross investment in fixed assets during 2016? (Enter your answer in millions.)
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