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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
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
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The following table shows an abbreviated income statement and balance sheet for McDonald's Corporation for 2012. INCOME STATEMENT OF MCDONALD'S CORP., 2012 (Figures in $ millions) Net sales Costs Depreciation Earnings before interest and taxes (EBIT) Interest expense Pretax income Taxes Net income 27,570 17,572 1,405 8,593 520 8,073 2,620 5,453
Transcribed Image Text:The following table shows an abbreviated income statement and balance sheet for McDonald's Corporation for 2012. INCOME STATEMENT OF MCDONALD'S CORP., 2012 (Figures in $ millions) Net sales Costs Depreciation Earnings before interest and taxes (EBIT) Interest expense Pretax income Taxes Net income 27,570 17,572 1,405 8,593 520 8,073 2,620 5,453
Assets Current assets Cash and marketable securities Receivables Inventories Other current assets Total current assets Fixed assets Property, plant, and equipment Intangible assets (goodwill) Other long-term assets Total assets BALANCE SHEET OF MCDONALD'S CORP., 2012 (Figures in $ millions) Liabilities and Shareholders' equity Current llabilities 2012 2,339 1,378 125 1,092 4,934 24,680 2,807 2,986 35,407 2011 2,339 Debt due for repayment 1,338 Accounts payable 120 Total current liabilities 619 4,416 Long-term debt 22,838 Other long-term liabilities 2,656 Total llabilities 3,102 Total shareholders' equity 33,012 Total liabilities and shareholders' equity 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 million 2012 3,406 3,406 13,636 3,060 2011 b. 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 Intermediate calculations. Enter your answer In millions rounded to the nearest whole number.) Additional tax 376 3,146 3,522 12,137 2,960 20,102 18,619 15,305 14,393 35,407 33,012
Transcribed Image Text:Assets Current assets Cash and marketable securities Receivables Inventories Other current assets Total current assets Fixed assets Property, plant, and equipment Intangible assets (goodwill) Other long-term assets Total assets BALANCE SHEET OF MCDONALD'S CORP., 2012 (Figures in $ millions) Liabilities and Shareholders' equity Current llabilities 2012 2,339 1,378 125 1,092 4,934 24,680 2,807 2,986 35,407 2011 2,339 Debt due for repayment 1,338 Accounts payable 120 Total current liabilities 619 4,416 Long-term debt 22,838 Other long-term liabilities 2,656 Total llabilities 3,102 Total shareholders' equity 33,012 Total liabilities and shareholders' equity 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 million 2012 3,406 3,406 13,636 3,060 2011 b. 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 Intermediate calculations. Enter your answer In millions rounded to the nearest whole number.) Additional tax 376 3,146 3,522 12,137 2,960 20,102 18,619 15,305 14,393 35,407 33,012
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