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1.

Ending Cash 94,000

2.

1996 Sales Bad debt expense Net receivables Cash collections1 $ ----30 $ ---

1997 $ 140 7 40 $ 123

1998 $150 7 50 $133

1999 $165 8 60 $147

2000 $175 10 75 $150

2001 $195 10 95 $165

3. Cash Balance 12/31/01 $ 60

4.

Net income $

92

b. Change in cash $

16

c. Change in cash M

1996

1997

1998

1999

2000

15

(20)

16

Net Income: M

1996 Net Income 42

1997

1998

1999

2000

40

36

37

Change in cash G 1996 1997 1998 1999 2000

19

35

Net Income: G

1996 Net Income 23

1997

1998

1999

2000

42

58

72

94

5. A. i Net change in cash $ 100

Ii Cash from operating $1,530 Net change in cash $ 100

6. B

CHANGE

IN CASH

524

524

9.

Net change in cash

92 $ 13,379

93 $ (3,064)

94 $ (15,379)

Taxes paid
(12,414)

$ (22,989)

$ (8,408)

10. c As Reported 1987 Receivables Inventory PPE Goodwill ST debt A/C payable Accrued liabilities LT debt 2,277 6,293 3,848 17,122 1,571 10,829 530 900 1,041 9,929 $ 2,065 4,154 6,582 4,052 1,440 791 As Reported 1988 $ 2,222 5,384 8,648 15,071 1,259 1,777 Reported Change 1987-88 $ 157 1,230 2,066 11,019 (181) 986 Less Kraft $ 758 1,232 1,740 10,361 700 578 Adjusted Change $ (601) (2) 326 658 (881) 408

10. b Increase in cash and equivalents $ 78

Philip Morris Companies, Inc. Worksheet for Statement of Cash Flows Indirect Method

Year Ended December 31, 1988 Cash flows from operating activities: Net income Adjustments to cash basis: Depreciation expense Amortization of goodwill Decrease in accounts receivable Decrease in inventory Decrease in deferred taxes Increase in accounts payable Increase in accrued liabilities Increase in income taxes payable Net cash flow from operating activities

($ Millions)

$ 2,337

654 125 601 2 (325) 408 1,041 362 $ 5,205

Cash flows from investing activities: Increase in PPE (before depreciation) Increase in goodwill (before amort.) Decrease in investments Acquisition of Kraft Net cash used by investing activities $ (980) (783) 405 (11,383) (12,741)

Cash flows from financing activities: Decrease in short-term debt Increase in long-term debt Decrease in stockholders' equity (repurchase) (540) $ (881) 9,929

Dividends declared Increase in dividends payable Net cash provided by financing activities Net increase in cash

(941) 47 7,614

78

Supplementary disclosure of cash flow information:


Interest paid during year Income taxes paid during year 670 1,353

Schedule of noncash investing and financing activities:

$-------

11. a Cash from operations $ 411.6

12. A 1989 $ 532 1990 $ 682 1991 $ 518

Adjusted cash from operations

C 1989 Adjusted cash flow for investing $ (782) 1990 $ $ (669) 1991 $ (304)

e. 1989 $ (250) 1990 $ 13 1991 $ 214

Equals: free cash flow

13 a. 1998 1999 7,685 714

Cash from operating activities Net change


13 A ii

3,056 (84)

1998 Change in cash and equivalents 65 297

13 d Repsol Cash from Operations ( Millions) Years ended 12/31 Operating activities: 3,0 Cash from operations 56 685 7, 9 1998 1999

Difference
4,62

14 a Cash flow from operations $ 700

14 b. 2000 Net income $ 825 2001 $ 600

14. c % change Sales 12.68%

Cash collections

12.14%

Cash collections/sales
Cost of goods sold Cash inputs Cash inputs/COGS 19.05% 20.73%

SG&A Cash expenses Cash expenses/SG&A

19.40% 15.71%

15 A Cash flow from operations $791

15 b 2000 Net income $ 840 2001 $ 792

15. c % change

Sales
Cash collections Cash collections/sales

-0.79% 3.12%

Cost of goods sold

-1.67%

Cash inputs Cash inputs/COGS

-4.52%

SG&A* Cash expenses Cash expenses/SG&A

2.01% -5.93%

16. A Cash flow from operations $1,195

16. b % change

Sales
Cash collections Cash collections/sales Cost of goods sold Cash inputs Cash inputs/COGS SG&A* Cash expenses Cash expenses/SG&A Interest expense Interest paid Interest paid/Interest expense

20.0% 20.0%

18.3% 30.0% 35.0% 36.3% 0.0% 9.1%