QUESTION: D. What is cash provided by operations during 2014? (do not round inte

Question

QUESTION: D. What is cash provided by operations during 2014? (do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)

(NOTE: the answer is NOT 174.5 I have already tried to calculate it and this answer is wrong)

South Sea Baubles has the following (incomplete) balance sheet and income statement. BALANCE SHEET AT END OF YEAR (Figures in $ millions) Assets Current assets Net fixed assets 2013 2014 Liabilities and Shareholders' Equity 2013 2014 50 60 600 750 90 140 Current liabilities 800 900 Long-term debt INCOME STATEMENT, 2014 (Figures in $ millions) Revenue Cost of goods sold Depreciation Interest expense 1,950 1,030 350 240 a. What is shareholders' equity in 2013 and 2014? (Enter your answers in millions.) 2013 2014 Shareholders' equity 240 million 230 million b. What is net working capital in 2013 and 2014? (Enter your answers in millions.) 2014 Net working capital 40 million 80ion c. What are taxes paid in 2014? Assume the firm pays taxes equal to 35% of taxable income. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.) Taxes paid 115.50 million d. What is cash provided by operations during 2014? (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places Cash provided by operations million e. Net fixed assets increased from $800 million to $900 million during 2014. What must have been South Sea's gross investment in fixed assets during 2014 (Enter your answer in millions.) Gross investment 450 million

Explanation / Answer

Cashflow from Operations = PAT + Depreciation + change in working capital

Change in working capital =-(140-90) +(60-50)

=-50 +10

=-40

= 214.5 + 350 -40

=524.5

Year 1 Revenues 1950 Operating Costs 1030 Depreciation 350 Interest 240 Profit Before tax 330 Tax = 115.5 PAT 214.

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