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

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

Balance Sheets as of December 31
2018 2017
Assets
Cash and equivalents $  13,000 $  12,000
Accounts receivable 30,000 25,000
Inventories 27,115 24,000
  Total current assets $ 70,115 $ 61,000
Net plant and equipment 52,000 48,000
Total assets $122,115 $109,000
Liabilities and Equity
Accounts payable $ 10,400 $  9,000
Accruals 8,000 7,000
Notes payable 6,900 5,450
  Total current liabilities $ 25,300 $ 21,450
Long-term bonds 10,000 10,000
  Total liabilities $ 35,300 $ 31,450
Common stock (4,000 shares) 60,000 60,000
Retained earnings 26,815 17,550
  Common equity $ 86,815 $ 77,550
Total liabilities and equity $122,115 $109,000
Income Statement for Year Ending December 31, 2018
Sales $242,000
Operating costs excluding depreciation and amortization 190,000
EBITDA $ 52,000
Depreciation & amortization 7,000
EBIT $ 45,000
Interest 7,450
EBT $ 37,550
Taxes (40%) 15,020
Net income $ 22,530
Dividends paid 13,265

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 net operating working capital for 2017 and 2018? Assume that all cash is excess cash; i.e., this cash is not needed for operating purposes.
    2017 $    million
    2018 $    million

  2. What was Arlington's 2018 free cash flow?

    $    million
  3. Construct Arlington's 2018 statement of stockholders' equity.
    Statement of Stockholders' Equity, 2018
    Common Stock Retained
    Earnings    		 Total Stockholders'
    Equity
    Shares Amount
    Balances, 12/31/17   million $    million $    million $    million
    2018 Net Income   million
    Cash Dividends   million
    Addition to retained earnings   million
    Balances, 12/31/18   million $    million $    million $    million
  4. What was Arlington's 2018 EVA? Assume that its after-tax cost of capital is 10%. Round your answer to two decimal places.

    $    million

  6. What was Arlington's MVA at year-end 2018? Assume that its stock price at December 31, 2018 was $25. Round your answer to two decimal places.

    $    million

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Expert Solution

Hi Student

Please see below answer.

jeff jeffy answered 2 years ago
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