Question

Arlington Corporation's financial statements (dollars and shares are in millions) are provided here.

Balance Sheets as of December 31
	2019		2018
Assets
Cash and equivalents	$  15,000		$  12,000
Accounts receivable	35,000		25,000
Inventories	31,650		24,000
Total current assets	$ 81,650		$ 61,000
Net plant and equipment	47,000		46,000
Total assets	$128,650		$107,000
Liabilities and Equity
Accounts payable	$ 10,400		$  8,000
Accruals	8,000		6,000
Notes payable	6,700		5,400
Total current liabilities	$ 25,100		$ 19,400
Long-term bonds	15,000		15,000
Total liabilities	$ 40,100		$ 34,400
Common stock (4,000 shares)	60,000		60,000
Retained earnings	28,550		12,600
Common equity	$ 88,550		$ 72,600
Total liabilities and equity	$128,650		$107,000

Income Statement for Year Ending December 31, 2019
Sales	$246,000
Operating costs excluding depreciation and amortization	200,000
EBITDA	$ 46,000
Depreciation & amortization	3,000
EBIT	$ 43,000
Interest	4,900
EBT	$ 38,100
Taxes (25%)	9,525.00
Net income	$ 28,575.00
Dividends paid	12,625.00

Enter your answers in millions. For example, an answer of $25,000,000,000 should be entered as 25,000. Round your answers to the nearest whole number, if necessary.

1. What was Arlington's 2019 free cash flow?

   $    million

2. Construct Arlington's 2019 statement of stockholders' equity.

   Statement of Stockholders' Equity, 2019
   	Common Stock		Retained Earnings	Total Stockholders' Equity
   	Shares	Amount
   Balances, 12/31/18	million	$    million	$    million	$    million
   2019 Net Income			million
   Cash Dividends			million
   Addition to retained earnings				million
   Balances, 12/31/19	million	$    million	$    million	$    million

3. What was Arlington's 2019 EVA? Assume that its after-tax cost of capital is 10%. Round your answer to the nearest cent.

   $    million

4. What was Arlington's MVA at year-end 2019? Assume that its stock price at December 31, 2019 was $25. Round your answer to the nearest cent.

   $    million

Answer 1