The Davidson Corporation's balance sheet and income statement are provided here.
Davidson Corporation: Balance Sheet as of December 31, 2016 (Millions of Dollars)
| Assets |
|
|
Liabilities and Equity |
|
| Cash and equivalents |
$10 |
|
Accounts payable |
$140 |
| Accounts receivable |
610 |
|
Accruals |
290 |
| Inventories |
830 |
|
Notes payable |
230 |
| Total current assets |
$1,450 |
|
Total current liabilities |
$660 |
| Net plant and equipment |
2,480 |
|
Long-term bonds |
1,490 |
|
|
|
Total liabilities |
$2,150 |
|
|
|
Common stock (100 million shares) |
280 |
|
|
|
Retained earnings |
1,500 |
|
|
|
Common equity |
$1,780 |
| Total assets |
$3,930 |
|
Total liabilities and equity |
$3,930 |
Davidson Corporation: Income Statement for Year Ending December 31, 2016 (Millions of Dollars)
| Sales |
$6,000 |
| Operating costs excluding depreciation and amortization |
4,860 |
| EBITDA |
$1,140 |
| Depreciation and amortization |
360 |
| EBIT |
$780 |
| Interest |
215 |
| EBT |
$565 |
| Taxes (40%) |
226 |
| Net income |
$339 |
| Common dividends paid |
$250.86 |
| Earnings per share |
$3.39 |
1. Construct the statement of stockholders' equity for December 31, 2016. No common stock was issued during 2016. Write out all your answers completely. For example, 25 million should be entered as 25,000,000. Round your answers to the nearest share or dollar.
|
|
Common Stock |
Retained |
Total Stockholders' |
|
|
Shares |
Amount |
Earnings |
Equity |
|
Balances, 12/31/15 |
|
$ |
$ |
$ |
|
2016 Net income |
|
|
$ |
|
|
Cash dividends |
|
|
$ |
|
|
Addition to RE |
|
|
|
$ |
|
Balances, 12/31/16 |
|
$ |
$ |
$ |
|
|
|
|
|
Enter your answers for parts b-d in millions. For example, an answer of $25,000,000 should be entered as 25.
2. How much money has been reinvested in the firm over the years?
3. At the present time, how large a check could be written without it bouncing?
4. How much money must be paid to current creditors within the next year?