Question
You have just obtained financial information for the past 2 years for Sebring Corporation. SEBRING CORPORATION: INCOME STATEMENTS FOR YEAR ENDING DECEMBER 31 (MILLIONS OF
You have just obtained financial information for the past 2 years for Sebring Corporation. SEBRING CORPORATION: INCOME STATEMENTS FOR YEAR ENDING DECEMBER 31 (MILLIONS OF DOLLARS) 20022001
Sales$3,600.0$3,000.0 Operating costs (excluding depreciation and amortization)3,060.002,550.00 EBITDA$ 540.0$ 450.0 Depreciation and amortization9075 Earnings before interest and taxes$ 450.0$ 375.0 Interest 6560 Earnings before taxes$ 385.0$ 315.0 Taxes (30%)115.594.5 Net income available to common stockholders$ 269.5$ 220.5 SEBRING CORPORATION: BALANCE SHEETS FOR YEAR ENDING DECEMBER 31 (MILLIONS OF DOLLARS) 20022001 Assets: Cash and marketable securities$ 36.0$ 30.0 Accounts receivable520450 Inventories540620 Total current assets$1,096.0$1,100.0 Net plant and equipment920730 Total assets$2,016.0$1,830.0 Liabilities and equity: Accounts payable $ 324.0 $ 270.0 Notes payable201155 Accruals216180 Total current liabilities$ 741.0$ 605.0 Long-term bonds450450 Total debt$1,191.0$1,055.0 Common stock (50 million shares)150150 Retained earnings675625 Total common equity$ 825.0 $ 775.0 Total liabilities and equity$2,016.0$1,830.0 Required: Determine the values of the following: 1. Operating Cash Flows 2. Net Fixed Asset Investment 3. Net Current Asset Investment 4. Free Cash Flow
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