Question
When answering questions one through 34, you are to assume: MSFT's operating cash is the smaller of: (1) its cash and cash equivalents or (2)
When answering questions one through 34, you are to assume:
- MSFT's operating cash is the smaller of: (1) its cash and cash equivalents or (2) two percent of its total revenues.
- The following financial statement line items relate to operating activities: Other current assets (balance sheet). Other long-term assets (balance sheet). Other current liabilities (balance sheet). Deferred income taxes (balance sheet). Other long-term liabilities (balance sheet).
- Regarding all other financial statement line items, it is your responsibility to determine whether a particular line item relates either to operating activities or to financing activities.
- Inventory shown on MSFT's balance sheet relates to physical inventory?i.e., products that MSFT resells to its customers. The cost of revenue from sales of products equals the cost of physical inventory that was sold during the year.
- Accounts payable consists of: (1) amounts owed to suppliers of physical inventory and (2) amounts owed to advertisers of MSFT products, suppliers of services, etc. As of June 30, 2021 (June 30, 2020), the portion of accounts payable relating to amounts owed by MSFT to its suppliers of physical inventory was 5,000 (4,500) million U.S. dollars.
- During the fiscal year ending on June 30, 2021 MSFT's depreciation expense relating to property and equipment was 11,686 million U.S. dollars.
- The tax rate equals 21 percent
Finally, note that MSFT provides the following footnote disclosure about its cash, cash equivalents, short-term investments, and equity investments:
Our investments are intended to facilitate capital preservation. Our cash equivalents and short-term investments consist predominantly of highly liquid investment-grade fixed-income securities issued by governments, government agencies, and large corporations. Our equity investments consist predominantly of mutual fund securities.
6) What were MSFT's net financial obligations on June 30, 2021? Your answer should be in millions of U.S. dollars.
7) What was MSFT's invested capital on June 30, 2021? Your answer should be in millions of U.S. dollars.
8) What was MSFT's net financial expense before tax for the fiscal year ending on June 30, 2021? Your answer should be in millions of U.S. dollars.
9) What was MSFT's tax savings (cost) of financing activities for the fiscal year ending on June 30, 2021? If MSFT's financing activities generated tax savings (cost), enter your answer as a positive (negative) amount. Your answer should be in millions of U.S. dollars.
10) What was MSFT's net financial expense after tax for the fiscal year ending on June 30, 2021? Your answer should be in millions of U.S. dollars.
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