xHmh Flow Bailey Corporations financial statements dollars

x.Hmh Flow
Bailey Corporation\'s financial statements ( dollars and shares are in millions ) are provided here.
balance sheet as of december 31
   2008    2007

asset
cash and equivalents $14,000    $13,000
account receivable    30,000    25,000
Inventories    28,125 21,000
     Total current asset                                                                          $72,125           $59,000
net plant and equipment                                                                        50,000              47,000
total asset    $122,125    $106,000
Liabilities and equity   
Account payable    $10,800 $9,000
notes payable    6,700 5,150
accruals 7,600    6,000
total current liabilities $25,100 $20,150
long-term bonds    15,000    15,000
total debt $40,100    $35,150
common stock (5,000 shares)    50,000 50,000
Retained earnings    32,025    20,850
   commmon equity    $82,025    $70,850
total liabilities and equity                                                                      $122,125 $106,000
income statement for year ending december 31,2008

sales                                                               
balance sheet as of december 31
   2008    2007

asset
cash and equivalents $14,000    $13,000
account receivable    30,000    25,000
Inventories    28,125 21,000
     Total current asset                                                                          $72,125           $59,000
net plant and equipment                                                                        50,000              47,000
total asset    $122,125    $106,000
Liabilities and equity   
Account payable    $10,800 $9,000
notes payable    6,700 5,150
accruals 7,600    6,000
total current liabilities $25,100 $20,150
long-term bonds    15,000    15,000
total debt $40,100    $35,150
common stock (5,000 shares)    50,000 50,000
Retained earnings    32,025    20,850
   commmon equity    $82,025    $70,850
total liabilities and equity                                                                      $122,125 $106,000
income statement for year ending december 31,2008

sales                                                               
   2008    2007

asset
cash and equivalents $14,000    $13,000
account receivable    30,000    25,000
Inventories    28,125 21,000
     Total current asset                                                                          $72,125           $59,000
net plant and equipment                                                                        50,000              47,000
total asset    $122,125    $106,000
Liabilities and equity   
Account payable    $10,800 $9,000
notes payable    6,700 5,150
accruals 7,600    6,000
total current liabilities $25,100 $20,150
long-term bonds    15,000    15,000
total debt $40,100    $35,150
common stock (5,000 shares)    50,000 50,000
Retained earnings    32,025    20,850
   commmon equity    $82,025    $70,850
total liabilities and equity                                                                      $122,125 $106,000
income statement for year ending december 31,2008

sales                                                               
income statement for year ending december 31,2008

Solution

Net Working Capital = current asset - current liabilities Net Working Capital 2007 = 59,000 - 20,150 = $38,850 Net Working Capital 2008 = 72,125 - 25,100 = $47,025 Free CashFlow Net Income 22,350 Depreciation &amortization 5,000 Changes in WorkingCapital -8,175 CapitalExpenditure -3,000 Free CashFlow 16,175 Retained Earnings, Dec 31,2007                        20,850 Add: NetIncome                                                  22,350                                                                             43,200 Less:Dividendspaid                                             11,175 Retained Earnings, Dec 31,2008                        32,025

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