In: Finance
Income statements and balance sheets follow for E.I. DuPont de Nemours and Company. Refer to these financial statements to answer the requirements.
E. I. du Pont de Nemours and Company Consolidated Income Statements For The Year Ended December 31, |
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($ millions) |
2016 |
2015 |
Net sales |
$ 24,594 |
$ 25,130 |
Cost of goods sold and other operating charges |
15,155 |
15,571 |
Selling, general and administrative expenses |
4,319 |
4,615 |
Research and development expense |
1,641 |
1,898 |
Other (income) expense, net (non-operating) |
(708) |
(697) |
Interest expense |
370 |
342 |
Employee separation/asset related charges(income), net |
552 |
810 |
Income from continuing operations before income taxes |
3,265 |
2,591 |
Provision for income taxes on continuing operations |
744 |
696 |
Income from continuing operations after income taxes |
2,521 |
1,895 |
Income from discontinued operations after income taxes |
4 |
64 |
Net income |
2,525 |
1,959 |
Less: Net income attributable to noncontrolling interests |
12 |
6 |
Net income attributable to DuPont |
$ 2,513 |
$ 1,953 |
E. I. du Pont de Nemours and Company Consolidated Balance Sheets As of December 31, |
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($ millions) |
2016 |
2015 |
Assets |
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Cash and cash equivalents |
$ 4,605 |
$ 5,300 |
Marketable securities |
1,362 |
906 |
Accounts and notes receivable, net |
4,971 |
4,643 |
Inventories |
5,673 |
6,140 |
Prepaid expenses |
506 |
398 |
Total current assets |
17,117 |
17,387 |
Net property, plant and equipment |
9,231 |
9,784 |
Goodwill |
4,180 |
4,248 |
Other intangible assets |
3,664 |
4,144 |
Investment in affiliates |
649 |
688 |
Deferred income taxes |
3,308 |
3,799 |
Other assets |
1,815 |
1,116 |
Total assets |
$39,964 |
$41,166 |
Table continued next page
Table continued
E. I. du Pont de Nemours and Company Consolidated Balance Sheets—continued As of December 31, |
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(in millions) |
2016 |
2015 |
Liabilities and equity |
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Accounts payable |
$ 3,705 |
$ 3,398 |
Short-term borrowings and capital lease obligations |
429 |
1,165 |
Taxes payable |
101 |
173 |
Other accrued liabilities |
4,662 |
5,580 |
Total current liabilities |
8,897 |
10,316 |
Long-term borrowings and capital lease obligations |
8,107 |
7,642 |
Other liabilities |
12,333 |
12,591 |
Deferred income taxes |
431 |
417 |
Total liabilities |
29,768 |
30,966 |
Common stock, $0.30 par value |
285 |
288 |
Preferred stock, without par value – cumulative |
237 |
237 |
Additional paid-in capital |
11,190 |
11,081 |
Reinvested earnings |
14,924 |
14,510 |
Accumulated other comprehensive loss |
(9,911) |
(9,396) |
Common stock held in treasury |
(6,727) |
(6,727) |
Total DuPont stockholders’ equity |
9,998 |
9,993 |
Noncontrolling interests |
198 |
207 |
Total equity |
10,196 |
10,200 |
Total liabilities and stockholders’ equity |
$39,964 |
$41,166 |
Required
a. Compute net operating profit after tax (NOPAT) for 2016 and 2015. Assume that combined federal and state statutory tax rate is 37% for both years.
b. Compute net operating assets (NOA) for 2016 and 2015.
c. Compute return on net operating assets (RNOA) for 2016 and 2015. Net operating assets are $13,239 million in 2014.