LARK CORPORATION Balance Sheet December 31 Assets 2010 Cash $28,880 Receivables
ID: 2441912 • Letter: L
Question
LARK CORPORATIONBalance Sheet
December 31
Assets 2010
Cash $28,880
Receivables (net) 79,321
Other current assets 89,321
Long-term investments 75,000
Plant and equipment (net)
519,321
Total assets
$791,843
Liabilities and Stockholders' Equity
Current liabilities $78,880
Long-term debt 89,321
Common stock 339,321
Retained earnings
284,321
Total liabilities and stockholders' equity
$791,843
LARK CORPORATION
Income Statement
For the Years Ended December 31
2010
Sales $754,072
Cost of goods sold 440,000
Operating expenses (including income taxes)
240,000
Net income
$74,072
Additional information:
Cash from operating activities $90,830
Cash used for capital expenditures $48,830
Dividends paid $23,830
Average number of shares outstanding 33,000
Explanation / Answer
The formula for calculating Free cash flows is Free cash flows = Net cash flow from operations - Capital expenditures - Dividends From the given information, Net cash flow from Operations = $90,830 Capital expenditure = $48,830 Dividends = $23,830 Substituting the values in the above formula, we get Free cash flows = $90,830 - $48,830 - $23,830 = $18,170 Therefore, the value of free cash flows is $18,170.
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