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Nabors Inc. 2009 Income Statement ($ in millions) Bet Sales $9,610 Less: Cost of Goods Sold...

Nabors Inc. 2009 Income Statement ($ in millions)

Bet Sales

$9,610

Less: Cost of Goods Sold

6,310

Less Depreciation

1,370

Earnings before interest and taxes

1,930

Less: Interest paid

630

Taxable income

$1,300

Less taxes

455

Net Income

$   845

Nabors Inc. 2008 and 2009 Balance sheets ($ in millions)

2008

2009

2008

2009

Cash

$310

$405

Accounts Pay

$2720

$2570

Accounts Rec.

2640

3055

Notes Pay

100

0

Inventory

3275

3850

Total

$2820

$2570

Total

$6225

$7310

Long Term Debt

7875

8100

Net Fixed Assets

10960

10670

Common stock

5000

5250

Retained Earn

1490

2060

Total Assets

$17,185

$17,980

Total Liab & Equ

$17,185

$17,980

1.  What is the amount of the noncash expenses for 2009?

A. $570

B. $630

C. $845

D. $1,370

E. $2,000

2. What is the change in the net working capital from 2008 to 2009?

A. $1,235

B. $1,035

C. $1,305

D. $1,335

E. $1535

3.  What is the operating cash flow for 2009?

A. $845

B. $1,930

C. $2,215

D. $2,845

E. $3,060

4. What is the amount of the net capital spending for 2009?

A. -$290

B. $795

C. $1,080

D. $1,660

E. $2,165

Solutions

Expert Solution

1.) Amount of Non Cash Expense $ 1,370
( i.e. Depreciation Expense )
Correct answer is option D .
2.) 2008 Working Capital        3,405 =6225-2820
2009 Working Capital        4,740 =7310-2570
Change in Net Working Capital $ 1,335 =4740-3405
Correct answer is option D .
3.) Net Income           845
Add: Depreciation        1,370
Less: Increase in accounts Rec.          -415 =2640-3055
Less: Increase in Inventory          -575 =3275-3850
Less :Decrease in accounts pay          -150 =2570-2720
Less: Decrease in Notes Payable          -100 =0-100
Operating cash flow for 2009 $ 975
4.) Amount of the net capital spending for 2009 $ 1,080 =10670-(10960-1370)
Correct answer is option C .

ekkarill92 answered 3 years ago
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