Quantitative Problem: Rosnan Industries' 2018 and 2017 balance sheets and income statements are shown below....
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Accounting
Quantitative Problem: Rosnan Industries' 2018 and 2017 balance sheets and income statements are shown below.
Balance Sheets
Assets
2018
2017
Cash and equivalents
$100
$85
Accounts receivable
275
300
Inventories
375
250
Total current assets
$750
$635
Net plant and equipment
2,300
1,490
Total assets
$3,050
$2,125
Liabilities and Equity
Accounts payable
$150
$85
Accruals
75
50
Notes payable
150
75
Total current liabilities
$375
$210
Long-term debt
450
290
Total liabilities
825
500
Common stock
1,225
1,225
Retained earnings
1,000
400
Common equity
2,225
1,625
Total liabilities and equity
$3,050
$2,125
Income Statements
2018
2017
Sales
$3,100
$1,600
Operating costs excluding depreciation and amortization
1,250
1,000
EBITDA
$1,850
$600
Depreciation and amortization
100
75
EBIT
$1,750
$525
Interest
62
45
EBT
$1,688
$480
Taxes (40%)
675
192
Net income
$1,013
$288
Dividends paid
$53
$48
Addition to retained earnings
$600
$240
Shares outstanding
100
100
Price
$25.00
$22.50
WACC
10.00%
The balance in the firm's cash and equivalents account is needed for operations and is not considered "excess" cash.
Using the financial statements given above, what is Rosnan's 2018 free cash flow (FCF)? Use a minus sign to indicate a negative FCF. Round your answer to the nearest dollar. $
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