Question

Free Cash Flow

Financial information for Powell Panther Corporation is shown below:

Powell Panther Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)

? 2012 2011
Sales $2,500.0 $2,000.0
Operating costs excluding depreciation and amortization 2,000.0 1,700.0
EBITDA $500.0 $300.0
Depreciation and amortization 57.0 44.0
Earnings before interest and taxes $443.0 $256.0
Interest 55.0 44.0
Earnings before taxes $388.0 $212.0
Taxes (40%) 155.2 84.8
Net income
$232.8
$127.2
Common dividends
$210.0
$102.0

Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars)

? 2012 2011
Assets
Cash and equivalents $31.0 $26.0
Accounts receivable 240.0 200.0
Inventories 400.0 320.0
Total current assets $671.0 $546.0
Net plant and equipment 572.0 440.0
Total assets
$1,243.0
$986.0
Liabilities and Equity
Accounts payable $225.0 $180.0
Notes payable 50.0 40.0
Accruals 120.0 100.0
Total current liabilities $395.0 $320.0
Long-term bonds 500.0 400.0
Total debt $895.0 $720.0
Common stock 287.2 228.0
Retained earnings 60.8 38.0
Common equity
$348.0
$266.0
Total liabilities and equity
$1,243.0
$986.0

Write out your answers completely. For example, 25 million should be entered as 25,000,000.

  1. What was net operating working capital for 2011 and 2012?

    2011: $

    2012: $

  2. What was the 2012 free cash flow?

    $
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