For each company:

· Compute the components of the cash flow diagram (i.e. Arrows 1-5). .

· Draw the free cash flow diagram and label it with cash flow dollar amounts and arrows pointing in the directions indicated by the dollar amounts.

· Write a brief paragraph describing what the dollar amounts imply about how cash flowed during the year. Describe the action in the diagram from left to right

  

Transcribed Image Text:

Year ending: Units: Income Statement. Net Sales -COGS (excluding Dep.) -Depreciation -SG&A Expense = EBIT Interest Taxes = Net Income Dividends Retained Earnings Balance Sheet** Current Assets Net Fixed Assets Total Assets Current Liabilities Long-Term Debt Com Stock & PIC -Treasury Stock*** Acc. Retain, Earn Total Liab & SE As of: Delta Airlines Inc. 31 Dec 2020 $ billions Dec 20 17.4 54.6 72.0 13.5 55.6 1.5 0.0 1.4 72.0 10.7 21.3 2.3 1.8 -14.7 0.9 -3.2 -12.4 0.0 -12.4 Dec 19 8.3 56.2 64.5 17.1 32.1 1.5 0.0 13.8 64.5 Hyatt Hotels Corp. 31 Dec 2020 $ billions Dec 20 2.6 6.5 9.1 0.7 5.2 0.0 0.0 3.2 9.1 2.0 2.1 0.4 0.3 -0.8 0.1 -0.1. -0.8 0.0 -0.8 Dec 19 1.7 6.7 8.4 1.1 3.3 0.0 0.0 4.0 8.4 Amazon.com Inc. 31 Dec 2020 $ billions Dec 20 132.7 188.5 321.2 110.3 117.3 42.9 1.9 52.6 321.2 389.1 216.6 16.7 129.9 25.9 1.6 2.9 21.4 0.0 21.4 Dec 19 96.3 128.9 225.2 73.5 88.7 33.7 1.9 31.2 225.2 Kroger Co. 28 February 2021 $ billions Feb 21 12.5 39.1 51.6 13.8 27.6 5.4 18.2 23.0 51.6 133.3 101.0 3.4 25.1 3.8 0.5 0.8 2.5 0.5 2.0 Feb 20 10.9 37.0 47.9 11.6 27.1 5.2 17.0 21.0 47.9 A negative tax, as for Delta and Hyatt, is a tax rebate (credit). Subtracting a negative tax from EBIT is equivalent to adding a (positive) tax rebate to EBIT. ** For each company the balance sheet on the left (right) is the ending (starting) balance sheet. *** Treasury stock is subtracted from the other liability accounts because it is a "contra account, an asset appearing on the liability side of the balance sheet. Treasury stock itself is either zero or positive. Year ending: Units: Income Statement. Net Sales -COGS (excluding Dep.) -Depreciation -SG&A Expense = EBIT Interest Taxes = Net Income Dividends Retained Earnings Balance Sheet** Current Assets Net Fixed Assets Total Assets Current Liabilities Long-Term Debt Com Stock & PIC -Treasury Stock*** Acc. Retain, Earn Total Liab & SE As of: Delta Airlines Inc. 31 Dec 2020 $ billions Dec 20 17.4 54.6 72.0 13.5 55.6 1.5 0.0 1.4 72.0 10.7 21.3 2.3 1.8 -14.7 0.9 -3.2 -12.4 0.0 -12.4 Dec 19 8.3 56.2 64.5 17.1 32.1 1.5 0.0 13.8 64.5 Hyatt Hotels Corp. 31 Dec 2020 $ billions Dec 20 2.6 6.5 9.1 0.7 5.2 0.0 0.0 3.2 9.1 2.0 2.1 0.4 0.3 -0.8 0.1 -0.1. -0.8 0.0 -0.8 Dec 19 1.7 6.7 8.4 1.1 3.3 0.0 0.0 4.0 8.4 Amazon.com Inc. 31 Dec 2020 $ billions Dec 20 132.7 188.5 321.2 110.3 117.3 42.9 1.9 52.6 321.2 389.1 216.6 16.7 129.9 25.9 1.6 2.9 21.4 0.0 21.4 Dec 19 96.3 128.9 225.2 73.5 88.7 33.7 1.9 31.2 225.2 Kroger Co. 28 February 2021 $ billions Feb 21 12.5 39.1 51.6 13.8 27.6 5.4 18.2 23.0 51.6 133.3 101.0 3.4 25.1 3.8 0.5 0.8 2.5 0.5 2.0 Feb 20 10.9 37.0 47.9 11.6 27.1 5.2 17.0 21.0 47.9 A negative tax, as for Delta and Hyatt, is a tax rebate (credit). Subtracting a negative tax from EBIT is equivalent to adding a (positive) tax rebate to EBIT. ** For each company the balance sheet on the left (right) is the ending (starting) balance sheet. *** Treasury stock is subtracted from the other liability accounts because it is a "contra account, an asset appearing on the liability side of the balance sheet. Treasury stock itself is either zero or positive.