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a. Using the financial statements shown below. calculate net operating working capital. total net operating capital, net operating profit after taxes, free cash flow (FCF capital (ROIC for 2013. Why FCF imporiant? What are the five uses FFCF? Use ROIC and the firm's WACC= 10% see if the company slight growth added value. Explain. Lan Chen Technologies: Income Statement for Year Ending December 31 (Thousands 2013 2012 Sales $945,000 $900,000 Expenses and amortizatic $12.700 774,000 EBIIDA $132,300 $126,000 33,100 31,500 EBII $99,200 $94,500 Interest 10,470 9,600 EBT $88,730 $85,900 Taxes (40%) 35,492 34,360 income $53,238 $51,540 Common dividends $43,300 $41,230 Addition $9,938 $10,310 Lan Chen December 31 Balance Sheets (Thousands Assets 2013 2012 Cash and cash $47,250 $45,000 Short 3,800 3,600 Accounts Receivable 283,500 270,000 Inventories 141,750 135,000 Total current $476.30 $453 600 Net fixed 330,750 315,000 Total assets $807,050 $768.60 Liabilities Accounts payable $94.50 $90,000 Accruals 47,250 45,000 Notes payable 26.262 9,000 Total current $168,012 $144,000 Long-t debt 94,500 90,000 Total liabilities $262,512 $234,000 Common stock 444,600 444,600 Retained Earnings 99.938 90,000 Total common $544,538 $534,600 Total liabilities and equity $807.05 $769,600 Key Input Data Tax rate 40% Net operating capital Operating Operating current current 2013 liabilities 2013 2013 Operating Operating current 2012 liabilities 2012 2012 Total net operating capital 2013 NOWC Fixed assets 2013 2013 TOC 2012 NOWC + Fixed assets 2012 2012 Investment capital 2013 2012 2013 InTOC= TOC TOC 2013 InTOC= 2013 InTOC= Net operating profit after taxes 2013 NOPAT EBII (1-T) 2013 NOPAT= 2013 NOPAT: Free cash 2013 NOPAT Net investment operating capital 2013 - 2013 Return Invested capital 2013 ROIC= NOPAT Total ut operating capital 2013 ROIC 2013 ROIC b. Assume 15 shares outstanding the end of the year. the year-end closing stock price was $65 per share and the after-lax cost of capital was 8% and MV, for the most recent year. What do these two represent? has the performance ol management the and sines the company inception? Explain. Additional Imput Data Stock price #of shares thousand Market Value Added MVA Total common equity MVA MVA MVA Economk Value Added EVA NOPAT (Operating After-tax costo capital) EVA EVA EVA

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