question 2-12Using the Rhodes Corporation’s financail statements (shown below) a

question 2-12Using the Rhodes Corporation’s financail statements (shown below) answer the following questions. d. What is the free cash flow for 2010? e. What is the ROIC for 2010? f. How much of the FCF did Rhodes use for each of the following purpoases: 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)Rhodes Corporation: Income Statement for the year ending December 31( Millions of dollars)20102009Sales $11,000.00 $10,000.00 Operating costs excluding depreceation $9,360.00 8500Deprececiation $380.00 360Earings before intrest and taxes $1,260.00 $1,140.00 Less intrest $120.00 100Earings before taxes $1,140.00 $1,040.00 Taxes (40%) $456.00 416Net income avaiable to common staockholders $684.00 $624.00 Common dividends $220.00 200Rhodes Corporation: Balance Sheet as of December 31 (Millions of Dollars)20102009AssestCash $550.00 $500.00 Short-term investments110100Accounts reciveiable27502500Inventories16501500Total current assets $5,060.00 $4,600.00 Net plant and equipment38503500Total assets $8,910.00 $8,100.00 20102009Liabilites and Equity Accounts payable $1,100.00 $1,000.00 Accruals550500Notes payable 384200Total current liabilites $2,034.00 $1,700.00 Long-term debt11001000Total liabilites $3,134.00 $2,700.00 Common stock 4,3124,400Retained earnings1,4641000Total common equity $5,776.00 $5,400.00 Total liabilites and equity $8,910.00 $8,100.00
NOWC (2009) = Operating CA – Operating CL = $4,600 ­ $1,700 = $2,900NOWC (2010) = Operating CA – Operating CL = $5,060 ­ $2,034 = $3,026Operating capital (2009) = Net plant and equipment +…

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