Assume the company generated $3,400 in net operating profits after taxes. Using the informationbelow, calculate the free cash flow for 2020.Balance Sheet as of December 31 (Millions of Dollars)2020201920202019AssetsLiabilities andEquity$900 Accounts payableCash$1,026$1,634$1,436Short-termInvestments90100 Accruals550500Accounts Receivable1,9681,726Notes645575payableInventories4,9714,367Total Current2,8292,511LiabilitiesTotal Current8,0557,093AssetsLong-term2,1732,815debtNet plant andequipment१.9438,733Total Liabilities5,0025,326CommonTotal Assets$17,998 $15.8262.4002,500stockRetained earnings10,5958,000Total common12.99510,500equityTotal liabilitics and$17.998 $15,826cquityO $1.423$1.739O $1.467O $1,534

free cashflow formula: free cashflow = NOPAT - change in working capital - change in capex

Assume the company generated $3,400 in net operating profits after taxes. Using the information below, calculate the free cash flow for 2020. Balance Sheet as of December 31 (Millions of Dollars) 2020 2019 2020 2019 Assets Liabilities and Equity Cash $1,026 $900 Accounts payable $1,634 $1,436 Short-term Investments 90 100 Accruals 550 500 Accounts Receivable 1,968 Notes 1,726 645 575 payable Inventories 4,971 4,367 Total Current 2,829 2,511 Liabilities Total Current 8,055 7.093 Assets Long-term 2,173 2,815 debt Net plant and equipment 9.943 8.733 Total Liabilities 5,002 5.326 Total Assets $17,998 $15,826 Common 2.400 2,500 stock Retained earnings 10.595 8,000 Total common 12.995 10.500 equity Total liabilities and $17.998 $15,826 cquity O $1.423 O $1.739 O $1,467 O $1.534

Assume the company generated $3,400 in net operating profits after taxes. Using the information below, calculate the free cash flow for 2020. Balance Sheet as of December 31 (Millions of Dollars) 2020 2019 2020 2019 Assets Liabilities and Equity Cash $1,026 $900 Accounts payable $1,634 $1,436 Short-term Investments 90 100 Accruals 550 500 Accounts Receivable 1,968 Notes 1,726 645 575 payable Inventories 4,971 4,367 Total Current 2,829 2,511 Liabilities Total Current 8,055 7.093 Assets Long-term 2,173 2,815 debt Net plant and equipment 9.943 8.733 Total Liabilities 5,002 5.326 Total Assets $17,998 $15,826 Common 2.400 2,500 stock Retained earnings 10.595 8,000 Total common 12.995 10.500 equity Total liabilities and $17.998 $15,826 cquity O $1.423 O $1.739 O $1,467 O $1.534

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

Assume the company generated $3,400 in net operating profits after taxes. Using the information
below, calculate the free cash flow for 2020.
Balance Sheet as of December 31 (Millions of Dollars)
2020
2019
2020
2019
Assets
Liabilities and
Equity
$900 Accounts payable
Cash
$1,026
$1,634
$1,436
Short-term
Investments
90
100 Accruals
550
500
Accounts Receivable
1,968
1,726
Notes
645
575
payable
Inventories
4,971
4,367
Total Current
2,829
2,511
Liabilities
Total Current
8,055
7,093
Assets
Long-term
2,173
2,815
debt
Net plant and
equipment
१.943
8,733
Total Liabilities
5,002
5,326
Common
Total Assets
$17,998 $15.826
2.400
2,500
stock
Retained earnings
10,595
8,000
Total common
12.995
10,500
equity
Total liabilitics and
$17.998 $15,826
cquity
O $1.423
$1.739
O $1.467
O $1,534

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