The following table shows an abbreviated income statement and balance sheet forMcDonald's Corporation for 2012.INCOME STATEMENT OF MCDONALD'S CORP.,2012(Figures in $ millions)Net salesCostsDepreciationEarnings before interest and taxes(EBIT)Interest expensePretax incomeTaxesNet income27,57017,5721,4058,5935208,0732,6205,453 AssetsCurrent assetsCash and marketablesecuritiesReceivablesInventoriesOther current assetsTotal current assetsFixed assetsProperty, plant, andequipmentIntangible assets(goodwill)Other long-term assetsTotal assetsBALANCE SHEET OF MCDONALD'S CORP., 2012(Figures in $ millions)Liabilities and Shareholders'equityCurrent llabilities20122,3391,3781251,0924,93424,6802,8072,98635,40720112,339 Debt due for repayment1,338 Accounts payable120 Total current liabilities6194,416Long-term debt22,838 Other long-term liabilities2,656 Total llabilities3,102 Total shareholders' equity33,012Total liabilities and shareholders'equityIn 2012 McDonald's had capital expenditures of $3,052.a. Calculate McDonald's free cash flow in 2012. (Enter your answer in millions.)Free cash flow$millionmillion20123,4063,40613,6363,0602011b.If McDonald's was financed entirely by equity, how much more tax would the companyhave paid? (Assume a tax rate of 35% on the revised pretax income.) (Do not roundIntermediate calculations. Enter your answer In millions rounded to the nearestwhole number.)Additional tax3763,1463,52212,1372,96020,102 18,61915,305 14,39335,407 33,012

We can compute FCF using the formula below: FC F = Net income + depreciation - increase in working…

In 2012 McDonald's had capital expenditures of $3,052. a. Calculate McDonald's free cash flow in 2012. (Enter your answer in millions.) Free cash flow $ million If McDonald's was financed entirely by equity, how much more tax would the company have paid? (Assume a tax rate of 35% on the revised pretax income.) (Do not round b. Intermediate calculations. Enter your answer In millons rounded to the nearest whole number.) Additional tax LA million

In 2012 McDonald's had capital expenditures of $3,052. a. Calculate McDonald's free cash flow in 2012. (Enter your answer in millions.) Free cash flow $ million If McDonald's was financed entirely by equity, how much more tax would the company have paid? (Assume a tax rate of 35% on the revised pretax income.) (Do not round b. Intermediate calculations. Enter your answer In millons rounded to the nearest whole number.) Additional tax LA million

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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13
Hartman Motors has $8 million in assets, which were financed with $4 million of debt and $4 million in equity. Hartman's beta is currently 1.9, and its tax rate is 30%. Use the Hamada equation to find Hartman's unlevered beta, bu. Do not round intermediate calculations. Round your answer to two decimal places.
For the past year, Kayla, Inc., has sales of $45,407, interest expense of $3,464, cost of goods sold of $15,784, selling and administrative expense of $11,291, and depreciation of $5,690. If the tax rate is 38 percent, what is the operating cash flow?. Only correct pls dont copy pls , correct stepwise
Casey Motors recently reported the following information: Net income = $828,000. Tax rate = 25%. Interest expense = $250,000. Total invested capital employed = $8.8 million. After-tax cost of capital = 10%. What is the company's EVA? Answer options are provided in whole dollar.
(Using common-size financial statements) The S&H Construction Company expects to have total sales next year totaling $14,600,000. In addition, the firm pays taxes at 35 percent and will owe $315,000 in interest expense. Based on last year's operations the firm's management predicts that its cost of goods sold will be 59 percent of sales and operating expenses will total 26 percent. What is your estimate of the firm's net income (after taxes) for the coming year? Complete the pro-forma income statement below: (Round to the nearest dollar.) Pro-Forma Income Statement Sales Cost of goods sold Gross profit Operating expenses Net operating income Interest expense Earnings before taxes Taxes Net income $
Tibbs Inc. had the following data for the most recent year: Net income = $300; Net operating profit after taxes (NOPAT) = $380; Total assets = $2,500; Short-term investments = $200; Stockholders' equity = $1,800; Total debt = $700; and Total operating capital = $2,300. What was its return on invested capital (ROIC)? Select the correct answer. a. 16.92% b. 16.52% c. 17.12% d. 16.72% e. 16.32%
A company which started its operation in the year 8. The pannel set the MARR at 10% after-tax. CCA rate = 20% FOR EQUIPTMENT. a) What is the remaining Undepreciated Capital cost at the end of year 20 12? b) What is the equivalent annual worth of the tax savings associated with these transactions if the corporate tax rate is 40%?
A firm had after-tax income last year of $2.1 million. Its depreciation expenses were $0.5 million, and its total cash flow was $2.1 million. What happened to net working capital during the year? (Enter your answer in millions rounded to 1 decimal place.)
Holly's Art Galleries recently reported $7.9 million of net income. Its EBIT was $13 million, and its federal tax rate was 21% (ignore any possible state corporate taxes). What was its interest expense? (Hint: Write out the headings for an income statement and then fill in the known values. Then divide $7.9 million net income by 1 − T = 0.79 to find the pre-tax income. The difference between EBIT and taxable income must be the interest expense.) Enter your answer in dollars. For example, an answer of $1.2 million should be entered as 1,200,000. Round your answer to the nearest dollar.
Home Depot entered fiscal 2017 with a total capitalization of $21,883 million. In 2017, debt investors received interest income of $870 million. Net income to shareholders was $8,633 million. (Assume a tax rate of 21%.) Calculate the economic value added assuming its cost of capital is 10%. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.
The most recent financial statements for Bradley, Inc., are shown here (assuming no income taxes):Assets and costs are proportional to sales. Debt and equity are not. No dividends are paid. Next year’s sales are projected to be $6,240. What is the external financing needed?
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