Question

Use the balance sheet and income statement below : CLANCY’S DOG BISCUIT CORPORATION Balance Sheet as of December 31, 2015 and 2014 (in millions of dollars) Assets 2015 2014 Liabilities and Equity 2015 2014 Current assets: Current liabilities: Cash and marketable securities $ 8 $ 8 Accrued wages and taxes $ 13 $ 7 Accounts receivable 38 30 Accounts payable 27 25 Inventory 41 35 Notes payable 25 23 Total $ 87 $ 73 Total $ 65 $ 55 Fixed assets: Long-term debt: $ 48 $ 43 Gross plant and equipment $ 111 $ 90 Stockholders’ equity: Less: Depreciation 31 25 Preferred stock (2 million shares) $ 2 $ 2 Common stock and paid-in surplus Net plant and equipment $ 80 $ 65 (5 million shares) 11 11 Other long-term assets 28 28 Retained earnings 69 55 Total $ 108 $ 93 Total $ 82 $ 68 Total assets $ 195 $ 166 Total liabilities and equity $ 195 $ 166 CLANCY’S DOG BISCUIT CORPORATION Income Statement for Years Ending December 31, 2015 and 2014 (in millions of dollars) 2015 2014 Net sales $ 108 $ 112 Less: Cost of goods sold 54 50 Gross profits $ 54 $ 62 Less: Other operating expenses 8 7 Earnings before interest, taxes depreciation, and amortization (EBITDA) $ 46 $ 55 Less: Depreciation 6 6 Earnings before interest and taxes (EBIT) $ 40 $ 49 Less: Interest 6 6 Earnings before taxes (EBT) $ 34 $ 43 Less: Taxes 16 19 Net income $ 18 $ 24 Less: Preferred stock dividends $ 1 $ 1 Net income available to common stockholders $ 17 $ 23 Less: Common stock dividends 3 3 Addition to retained earnings $ 14 $ 20 Per (common) share data: Earnings per share (EPS) $ 3.40 $ 4.60 Dividends per share (DPS) $ 0.60 $ 0.60 Book value per share (BVPS) $ 16.00 $ 13.20 Market value (price) per share (MVPS) $ 16.65 $ 16.60 Prepare a statement of cash flows for Clancy’s Dog Biscuit Corporation. (Enter your answers in millions of dollars. Amounts to be deducted should be indicated with a minus sign. Leave no cells blank - be certain to enter "0" wherever required.)

Answer 1