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Rhodes Corporation: Income Statements for Year EndingDecember 31(Millions of Dollars)20202019Sales$...

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


2020
2019
Sales$12,000
$11,000
Operating costs excluding depreciation
10,520

9,674
Depreciation and amortization
380

350
    Earnings before interest and taxes$1,100
$976
Less interest
240

200
    Pre-tax income$860
$776
Taxes (25%)
215

194
Net income available to common stockholders$645
$582
Common dividends$205
$200

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


2020
2019
Assets
Cash$450
$400
Short-term investments
110

100
Accounts receivable
2,750

2,500
Inventories
1,350

1,200
    Total current assets$4,660
$4,200
Net plant and equipment
3,750

3,500
Total assets$8,410
$7,700

Liabilities and Equity
Accounts payable$900
$800
Accruals
450

400
Notes payable
356

200
    Total current liabilities$1,706
$1,400
Long-term debt
900

800
    Total liabilities$2,606

2,200
Common stock
4,164

4,300
Retained earnings
1,640

1,200
    Total common equity$5,804
$5,500
Total liabilities and equity$8,410
$7,700

Suppose the federal-plus-state tax corporate tax is 25%. Answer the following questions.

net operating profit after taxes (NOPAT) for 2020 is 825million

amounts of net operating working capital for both years: 3200million (2020), 2900million (2019)

amounts of total net operating capital for both years: 6950million (2020), 6400million (2019)

a, What is the free cash flow for 2020? Enter your answer in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Cash outflow, if any, should be indicated by a minus sign. Round your answer to the nearest whole number.

$ _____ million

b, What is the ROIC for 2020? Round your answer to two decimal places.

___ %

c, How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answers in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answers to the nearest whole number.

After-tax interest payment$   million
Reduction (increase) in debt$   million
Payment of dividends$   million
Repurchase (Issue) stock$   million
Purchase (Sale) of short-term investments$   million

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