12 - The summary are cash flows Statements for 3 roughly equal size companies ($ Millions) a b c Net Cash Flow from operating activities $ (300.00) $ (300.00) $ 300.00 net Cash used in investing activitites $ (900.00) $ (30.00) $ (90.00) Net Cash from Financing activities $ 1,200.00 $ 210.00 $ (240.00) Cash balance at the beginning of the year $ 150.00 $ 150.00 $ 150.00 a. calculate each company cash balance at the end of the year b. Explain what might cost company C's net cash from financing activities to be negative c. Looking at company A & B, which company would you prefer to own? Why? d. In company C's cash flow statement cause for any concern on the part of C's management or shareholders ? Why? or why not?
| 12 - | ||||||||
| The summary are cash flows Statements for 3 roughly equal size companies | ||||||||
| ($ Millions) | ||||||||
| a | b | c | ||||||
| Net Cash Flow from operating activities | $ (300.00) | $ (300.00) | $ 300.00 | |||||
| net Cash used in investing activitites | $ (900.00) | $ (30.00) | $ (90.00) | |||||
| Net Cash from Financing activities | $ 1,200.00 | $ 210.00 | $ (240.00) | |||||
| Cash balance at the beginning of the year | $ 150.00 | $ 150.00 | $ 150.00 | |||||
| a. calculate each company cash balance at the end of the year | ||||||||
| b. Explain what might cost company C's net cash from financing activities to be negative | ||||||||
| c. Looking at company A & B, which company would you prefer to own? Why? | ||||||||
| d. In company C's cash flow statement cause for any concern on the part of C's management or shareholders ? Why? or why not? | ||||||||
Related questions
Please analyze the future of IBM with a company that does not have solid financials, such as Tesla. Qualitative measures will be required. What are tthe likelihoods of success and how could that be determined (for Tesla) if current numbers do not provide promise. Tesla is breaking into an emerging market of hybrid vehicle technology, and though the technology has not fully evovled, will it? How do Telsa's finaincial compare to IBM as they compare to success or failre?
Thank you
| TESLA INC (TSLA) CashFlowFlag INCOME STATEMENT | ||
| Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
| Revenue | 4046 | 7000 |
| Cost of revenue | 3123 | 5401 |
| Gross profit | 924 | 1599 |
| Operating expenses | ||
| Research and development | 718 | 834 |
| Sales, General and administrative | 922 | 1432 |
| Total operating expenses | 1640 | 2267 |
| Operating income | -717 | -667 |
| Interest Expense | 119 | 199 |
| Other income (expense) | -40 | 120 |
| Income before taxes | -876 | -746 |
| Provision for income taxes | 13 | 27 |
| Net income from continuing operations | -889 | -773 |
| Other | 98 | |
| Net income | -889 | -675 |
| Net income available to common shareholders | -889 | -675 |
| Earnings per share | ||
| Basic | -6.93 | -4.68 |
| Diluted | -6.93 | -4.68 |
| Weighted average shares outstanding | ||
| Basic | 128 | 144 |
| Diluted | 128 | 144 |
| EBITDA | -334 | 400 |
| TESLA INC (TSLA) Statement of CASH FLOW | ||
| Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
| Cash Flows From Operating Activities | ||
| Net income | -889 | -773 |
| Depreciation & amortization | 423 | 947 |
| Amortization of debt discount/premium and issuance costs | 72 | 87 |
| Stock based compensation | 198 | 334 |
| Accounts receivable | 46 | -217 |
| Inventory | -1574 | -2466 |
| Prepaid expenses | -30 | 57 |
| Accounts payable | ||
| Accrued liabilities | ||
| Other working capital | 1064 | 1932 |
| Other non-cash items | 165 | -26 |
| Net cash provided by operating activities | -524 | -124 |
| Cash Flows From Investing Activities | ||
| Investments in property, plant, and equipment | -1635 | -1440 |
| Acquisitions, net | -12 | 214 |
| Purchases of investments | ||
| Sales/Maturities of investments | 17 | |
| Other investing activities | -26 | -206 |
| Net cash used for investing activities | -1674 | -1416 |
| Cash Flows From Financing Activities | ||
| Debt issued | 319 | 2853 |
| Debt repayment | -204 | -1904 |
| Warrant issued | ||
| Common stock issued | 750 | 1702 |
| Other financing activities | 658 | 1094 |
| Net cash provided by (used for) financing activities | 1524 | 3744 |
| Effect of exchange rate changes | -34 | -7 |
| Net change in cash | -709 | 2196 |
| Cash at beginning of period | 1906 | 1197 |
| Cash at end of period | 1197 | 3393 |
| Free Cash Flow | ||
| Operating cash flow | -524 | -124 |
| Capital expenditure | -1635 | -1440 |
| Free cash flow | -2159 | -1564 |
| TESLA INC (TSLA) CashFlowFlag BALANCE SHEET | ||
| Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
| Assets | ||
| Current assets | ||
| Cash | ||
| Cash and cash equivalents | 1197 | 3393 |
| Total cash | 1197 | 3393 |
| Receivables | 169 | 499 |
| Inventories | 1278 | 2067 |
| Prepaid expenses | 125 | 194 |
| Other current assets | 23 | 106 |
| Total current assets | 2792 | 6260 |
| Non-current assets | ||
| Property, plant and equipment | ||
| Gross property, plant and equipment | 5766 | 12920 |
| Accumulated Depreciation | -571 | -1018 |
| Net property, plant and equipment | 5195 | 15037 |
| Intangible assets | 376 | |
| Other long-term assets | 106 | 991 |
| Total non-current assets | 5301 | 16404 |
| Total assets | 8092 | 22664 |
| Liabilities and stockholders' equity | ||
| Liabilities | ||
| Current liabilities | ||
| Short-term debt | 1150 | |
| Capital leases | 633 | |
| Accounts payable | 916 | 1860 |
| Taxes payable | 101 | 153 |
| Accrued liabilities | 322 | 1005 |
| Deferred revenues | 707 | 1427 |
| Other current liabilities | 137 | 232 |
| Total current liabilities | 2816 | 5827 |
| Non-current liabilities | ||
| Long-term debt | 2082 | 118 |
| Capital leases | ||
| Deferred taxes liabilities | ||
| Accrued liabilities | 150 | |
| Deferred revenues | 446 | 852 |
| Minority interest | 785 | |
| Other long-term liabilities | 1659 | 10179 |
| Total non-current liabilities | 4187 | 12084 |
| Total liabilities | 7004 | 17911 |
| Stockholders' equity | ||
| Common stock | 0 | 0 |
| Additional paid-in capital | 3415 | 7774 |
| Retained earnings | -2322 | -2997 |
| Accumulated other comprehensive income | -4 | -24 |
| Total stockholders' equity | 1089 | 4753 |
| Total liabilities and stockholders' equity | 8092 | 22664 |
| INTERNATIONAL BUSINESS MACHINES CORP (IBM) CashFlowFlag INCOME STATEMENT | ||
| Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
| Revenue | 81741 | 79919 |
| Cost of revenue | 41057 | 41625 |
| Gross profit | 40684 | 38294 |
| Operating expenses | ||
| Research and development | 4565 | 4120 |
| Sales, General and administrative | 19894 | 20479 |
| Other operating expenses | 535 | 590 |
| Total operating expenses | 24994 | 25189 |
| Operating income | 15690 | 13105 |
| Interest Expense | 468 | 630 |
| Other income (expense) | 723 | -145 |
| Income before taxes | 15945 | 12330 |
| Provision for income taxes | 2581 | 449 |
| Net income from continuing operations | 13364 | 11881 |
| Net income from discontinuing ops | -174 | -9 |
| Net income | 13190 | 11872 |
| Net income available to common shareholders | 13190 | 11872 |
| Earnings per share | ||
| Basic | 13.48 | 12.43 |
| Diluted | 13.42 | 12.38 |
| Weighted average shares outstanding | ||
| Basic | 979 | 955 |
| Diluted | 983 | 959 |
| EBITDA | 20268 | 17341 |
| INTERNATIONAL BUSINESS MACHINES CORP (IBM) Statement of CASH FLOW | ||
| Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
| Cash Flows From Operating Activities | ||
| Net income | 13190 | 11872 |
| Depreciation & amortization | 3855 | 4381 |
| Deferred income taxes | 1387 | -1132 |
| Stock based compensation | 468 | 544 |
| Inventory | 133 | -14 |
| Accounts payable | 81 | 197 |
| Accrued liabilities | ||
| Other working capital | -2658 | 1048 |
| Other non-cash items | 552 | 62 |
| Net cash provided by operating activities | 17008 | 16958 |
| Cash Flows From Investing Activities | ||
| Investments in property, plant, and equipment | -3579 | -3567 |
| Property, plant, and equipment reductions | 370 | 424 |
| Acquisitions, net | -3750 | -6133 |
| Purchases of investments | -3073 | -5917 |
| Sales/Maturities of investments | 2842 | 5692 |
| Purchases of intangibles | -572 | -583 |
| Other investing activities | -397 | -892 |
| Net cash used for investing activities | -8159 | -10976 |
| Cash Flows From Financing Activities | ||
| Debt issued | 5540 | 9132 |
| Debt repayment | -5622 | -6395 |
| Common stock issued | 322 | 204 |
| Common stock repurchased | -4609 | -3502 |
| Dividend paid | -4897 | -5256 |
| Other financing activities | 100 | 26 |
| Net cash provided by (used for) financing activities | -9166 | -5791 |
| Effect of exchange rate changes | ||
| Net change in cash | -317 | 191 |
| Cash at beginning of period | 8476 | 7686 |
| Cash at end of period | 8159 | 7877 |
| Free Cash Flow | ||
| Operating cash flow | 17008 | 16958 |
| Capital expenditure | -4151 | -4150 |
| Free cash flow | 12857 | 12808 |
| INTERNATIONAL BUSINESS MACHINES CORP (IBM) CashFlowFlag BALANCE SHEET | ||
| Fiscal year ends in December. USD in millions except per share data. | 2015-12 | 2016-12 |
| Assets | ||
| Current assets | ||
| Cash | ||
| Cash and cash equivalents | 7686 | 7826 |
| Short-term investments | 508 | 701 |
| Total cash | 8194 | 8527 |
| Receivables | 1201 | 1057 |
| Inventories | 1551 | 1553 |
| Deferred income taxes | ||
| Prepaid expenses | 4205 | 4564 |
| Other current assets | 27353 | 28187 |
| Total current assets | 42504 | 43888 |
| Non-current assets | ||
| Property, plant and equipment | ||
| Gross property, plant and equipment | 29341 | 60267 |
| Accumulated Depreciation | -18616 | -38606 |
| Net property, plant and equipment | 10725 | 21661 |
| Equity and other investments | 5187 | 4585 |
| Goodwill | 32021 | 36199 |
| Intangible assets | 3486 | 4689 |
| Deferred income taxes | 4822 | 5224 |
| Prepaid pension benefit | ||
| Other long-term assets | 11747 | 12055 |
| Total non-current assets | 67988 | 84413 |
| Total assets | 110492 | 128301 |
| Liabilities and stockholders' equity | ||
| Liabilities | ||
| Current liabilities | ||
| Short-term debt | 6461 | 7513 |
| Accounts payable | 6028 | 6209 |
| Taxes payable | 2847 | 3235 |
| Accrued liabilities | 7913 | 8282 |
| Deferred revenues | 11021 | 11035 |
| Other current liabilities | -1 | 1 |
| Total current liabilities | 34269 | 36275 |
| Non-current liabilities | ||
| Long-term debt | 33428 | 34655 |
| Deferred taxes liabilities | ||
| Accrued liabilities | ||
| Deferred revenues | 3771 | 3600 |
| Pensions and other benefits | 16504 | 17070 |
| Minority interest | 162 | 146 |
| Other long-term liabilities | 8099 | 7478 |
| Total non-current liabilities | 61964 | 62949 |
| Total liabilities | 96233 | 99224 |
| Stockholders' equity | ||
| Common stock | 53262 | 53935 |
| Retained earnings | 146124 | 152759 |
| Treasury stock | -155518 | -159050 |
| Accumulated other comprehensive income | -29606 | -29398 |
| Total stockholders' equity | 14262 | 18246 |
| Total liabilities and stockholders' equity | 110495 | 117470 |
Just need the last two questions answered A and B at the bottom of the document
Youâre the chief financial officer (CFO) of Worldwide
Widget Manufacturing, Inc. The company manufactures and
sells widgets at factories in the United States and internationally.
Listed below are partial financial statements for Worldwide
Widget Manufacturing, Inc. Fill in the missing information in
each of the following financial statements. Answer spaces are
given below.
Worldwide Widget Manufacturing, Inc.
Balance Sheet as of December 31, 2015 and 2014
(in millions of dollars)
| 2015 | 2016 | 2015 | 2016 | ||
| Assets Current Assets: | Liabilities and Equity Current Liabilities: | ||||
| Cash and markatable securities | $427 | $322 | Accured wages and taxes | $309 | $257 |
| Accounts Receivable | a.? | 259 | Accounts payable | 381 | b.? |
| Inventory | 815 | 797 | Notes Payable | $492 | $421 |
| Total | $1,542 | $1,378 | Total | $1,182 | $997 |
| Fixed Assets: | Long-term debt: | $1,934 | c.? | ||
| Gross plant and equipment | d.? | $2,817 | Total | 3,116 | 2,956 |
| Less:depreciation | 368 | 254 | Stockholder's equity: | ||
| Net plant and equipment | $2,872 | $2,563 | Preferred stock ( 30 million shares) | $30 | $30 |
| Other long term assets | 521 | 487 | Common stock and paid in surplus (250 million shares) | 300 | e.? |
| Retained earnings | 1,489 | 1,142 | |||
| Total FA | f.? | $3,050 | Total Equity | $1,819 | $1,472 |
| Total Assets | $4,935 | $4,428 | Total liabilities and equity | $4,935 | $4,428 |
A. Accounts receivable for 2015_______300
B. Accounts payable for 2014_______319
C. Gross plant and equipment for 2015_______1959
D. Long-term debt for 2014_______3240
E. Common stock and paid-in surplus (250 million shares) for 2014_______300
F. Total FA for 2015_______3393
Worldwide Widget Manufacturing, Inc. Income Statement for Years Ending December 31, 2015 and 2014(in millions of dollars)
| 2015 | 2014 | |
| Net Sales | g. | $2018 |
| Less: Cost of Goods Sold | 753 | h.? |
| Gross Profits | $1,623 | $1,189 |
| Less: Other Operating Expense | 423 | 167 |
| Earnings before interest, taxes, depreciation, and amortization (EBITDA) | $1,200 | $1,022 |
| Less: Depreciation | 114 | 114 |
| Earning before interest and taxes (EBIT) | $1,086 | $908 |
| Less: Interest | i.? | 128 |
| Earnings:before Taxes (EBT) | $949 | $780 |
| Less:Taxes | j.? | 23 |
| Net Income | $664 | $546 |
| Less:Preferred stock dividends | 98 | 98 |
| Net income available to common stock holders | $566 | $448 |
| Less:Common stock dividends | 219 | 199 |
| Addition to retained earnings Per common share data: | $347 | $249 |
| Earnings per share (EPS) | k.? | $1.79 |
| Dividends per share (DPS) | $0.88 | l. ? |
| Book Value per share (BVPS) | m.? | $5.77 |
| Market Value per share (MVPS) | $23.97 | $22.47 |
g. Net sales for 2015_______2376
h. Less: Cost of goods sold for 2014_______829
i. Less: Interest for 2015_______137
j. Less: Taxes for 2015_______285
k. Earnings per share (EPS) for 2015_______1.88
l. Dividends per share (DPS) for 2014_______.73
m. Book value per share (BVPS) for 2015_______7.16
Worldwide Widget Manufacturing, Inc.
Statement of Cash Flows for Year Ending December 31, 2015
(in millions of dollars)â
| Section A: Cash Flows from operating activities | |
| Net Income | n.? |
| Additions (source of cash): Depreciation | 114 |
| Increase in accrued wages and taxes | o.? |
| Increase in accounts payable | 62 |
| Subtractions (use of cash): Increase in accounts receivable | -41 |
| Increase in inventory | p.? |
| Net Cash flow from operating activities | q.? |
| Section B: Cash Flows from investing activities subtractions: Increase in fixed assets | -$343 |
| Increase in other long-term assests | r.? |
| Net Cash flow from investing activities | s.? |
| Section C. Cash flows from financing activities Additions: Increase in notes payable | t.? |
| Increase in common and preferred stock | 0 |
| Subtractions: Decrease in long-term debt | -25 |
| Pay dividends | u.? |
| Net Cash flow from financing activities Section D. Net Change in cash and marketable securities | v.? $105 |
n. Net income_______664
o. Increase in accrued wages and taxes_______52
p. Increase in inventory_______18
q. Net cash flow from operating activities_______833
r. Increase in other long-term assets_______34
s. Net cash flow from investing activities_______-377
t. Increase in notes payable_______71
u. Pay dividends_______317
v. Net cash flow from financing activities_______-271
Worldwide Widget Manufacturing, Inc.
Statement of Retained Earnings as of December 31, 2015
(in millions of dollars)
| Balance of retained earnings, December 31,2014 | $1,142 | |
| Plus: Net income for 2015 | w.? | |
| Less: Cash dividends paid | 0 | 0 |
| Preferred stock | x.? | |
| Common Stock | 219 | |
| Total cash dividends paid | 317 | |
| Balance of retained earnings, December 31,2015 | $1,489 |
w. Plus: Net income for 2015 _______664
x. Preferred stock _______98
2. Youâll need to compare your companyâs ratios with the industryâs standards.
Worldwide Widget Manufacturing, Inc.
| Company | Industy | Comparison | |
| Current Ratio | 2.2 times | ||
| Quick Ratio | 1.1 times | ||
| Cash Ratio | 0.35 times | ||
| Inventory turnover | 2 times or 1 time | ||
| Days' sales in inventory | 135 days or 335 days | ||
| Average payment period | 110 days | ||
| Sales to working capital | 3 times | ||
| Total asset turnover | 0.6 times | ||
| Debt-to equity | 1.1 times | ||
| Profit margin | 16.5% | ||
| Gross profit margin | 48.13% | ||
| ROA | 8.78% | ||
| ROE | 19.45% | ||
| Divident payout | 32% |
A. Use the information found in Worldwide Widget Manufacturingâs financial statements
to calculate all of the listed financial ratios in the above table for your
company. Then, for each ratio, provide a comparison of the companyâs result
with the industry standards, indicating if your companyâs results are lower than,
higher than, slower than, or faster than the industry standards.
B. Calculate your companyâs internal and sustainable growth rates.
