a. Using the financial statements shown below, calculate net operating working capital, total net operating capital, net operating profit after taxes, free cash flow, and return on invested capital for the most recent year.

Lan & Chen Technologies: Income Statements for Year Ending December 31

Lan & Chen Technologies: December 31 Balance Sheets

b. Assume that there were 15 million shares outstanding at the end of the year, the year-end closing stock price was $65 per share, and the after-tax cost of capital was 8%. Calculate EVA and MVA for the most recent year.

Lan & Chen Technologies: Income Statements for Year Ending December 31 (Thousands of Dollars) 2009 $945,000 $900,000 812.700 774.000 S132,300 S126,000 Expenses excluding depreciation and EBITDA Depreciation and amortization EBIT Interest Expense $99,200 S94,500 10.470 EBT Taxes (40%) $88,730 85,900 35 492 34,360 S53.238 S51,540 Net income Common dividends Addition to retained earnings S43,300 $41,230 S9,938 S10,310 Lan & Chen Technologies: December 31 Balance Sheets (Thousands of Dollars) Assets Cash and cash equivalents Short-term investments Accounts Receivable Inventories 2009 S47,250 $45,000 3.600 283.500 270,000 141.750 135.000 S476,300 S453,600 330,750 315.000 $807,050 $768,600 2010 Total current assets Net fixed assets Total assets 6 Liabilities and equity Accounts payable Accruals Notes payable S94,500 $90,000 47,250 45,000 26,262 Total current liabilities Long-term debt $168,012 S144,000 90.000 S262,512 $234,000 444,600 444,600 90.000 $544.538 S534.600 $807,050 $768,600 Total liabilities Common stock Retained Earnings 2 Total common equity Total liabilities and equity Lan & Chen Technologies: Income Statements for Year Ending December 31 (Thousands of Dollars) 2009 $945,000 $900,000 812.700 774.000 S132,300 S126,000 Expenses excluding depreciation and EBITDA Depreciation and amortization EBIT Interest Expense $99,200 S94,500 10.470 EBT Taxes (40%) $88,730 85,900 35 492 34,360 S53.238 S51,540 Net income Common dividends Addition to retained earnings S43,300 $41,230 S9,938 S10,310 Lan & Chen Technologies: December 31 Balance Sheets (Thousands of Dollars) Assets Cash and cash equivalents Short-term investments Accounts Receivable Inventories 2009 S47,250 $45,000 3.600 283.500 270,000 141.750 135.000 S476,300 S453,600 330,750 315.000 $807,050 $768,600 2010 Total current assets Net fixed assets Total assets 6 Liabilities and equity Accounts payable Accruals Notes payable S94,500 $90,000 47,250 45,000 26,262 Total current liabilities Long-term debt $168,012 S144,000 90.000 S262,512 $234,000 444,600 444,600 90.000 $544.538 S534.600 $807,050 $768,600 Total liabilities Common stock Retained Earnings 2 Total common equity Total liabilities and equity