Question

PIUNiem -3 riee Udsi riuw (LUZ-9) Rebecky's Flowers 4U, Inc., had free cash flows during 2021 of $47 million, NOPAT of $89 million, and depreciation of $11 million. Using this information, fill in the blanks on Rebecky's balance sheet below. (Enter your answers in millions of dollars.) REBECKY'S FLOWERS 4U, INC. Balance Sheet as of December 31, 2021 and 2020 2021 2021 2020 $ $ 17 $ 15 70 24 72 135 231 55 $ Assets Current assets: Cash and marketable securities Accounts receivable Inventory Total Fixed assets: Gross plant and equipment Less: Depreciation Net plant and equipment Other long-term assets Total (in millions of dollars) 2020 Liabilities and Equity Current liabilities: $ 21 Accrued wages and taxes 6 2 Accounts payable 117 Notes payable $ 200 Total Long-term debt: $ 320 Stockholders' equity: 40 Preferred stock (6 million shares) $ 280 Common stock and paid-in surplus 10 million shares) 50 Retained earnings $ 330 Total $ 530 Total liabilities and equity $ $ 140 209 $ $ 353 51 302 50 352 583 20 192 218 583 20 155 181 530 $ $ $ $ $ $ Total assets

Answer 1

Rebecky's Flower operating cash flow for 2021:

OCF = NOPAT + Depreciation = 89 + 11 =$100 million

So, Free cash flow = OCF - Investment in operating capital

47 = 100 - investment in operating capital

So, Investment in operating capital = $53 million

IOC = change in gross fixed assets + change in working capital

47 = (353-320) + change in working capital => Change in working capital = $14 million

change in working capital = change in current assets - change in current liabilities

=> 14 = (231-200) - (current liabilities of 2021 - 140)

=> Current liabilities = $157million

current liabilities = accrued wages and taxes + notes payable + accounts payable

=> account payable = 157-17-55 = $85 million

Long term debt = total liabilities and equity - current liabilities- equity

=> Long term liabilities = 583 - 157 - 218 = $208 million