1.a. MCI Communications additional funding requirements for 1992:1
Operating Receipts $10,000 million
Operating Expenditures - 8,706 million
Net Operating Cash Flow 1,294 million
Communications System Increase (Net) - 1,059 million
Income Tax Provision - 352 million
Interest & Other (Net) - 253 million
Dividends (Preferred & Common) - 55 million
Net Non Operating Cash Flow - 1,719 million
Net Cash Flow - 425 million
Beginning Cash Balance 41 million
Cash Shortfall - 384 million
Additional Funding Requirements 1992 $ 384 million
1Prepared according to L. J. Gitman, M. D. Joehnk, & G. E. Pinches, Managerial Finance, New York: Harper 1995.
1.b. An increase in the amount of dividends for 1992 of $10 million would increase the additional funding requirements by $10 million to $394 million.
2.a. New England Office Supplies cash budget July-December 1992: The cash budget is presented in Table 1.
2.b. New England Office Supplies pro-forma income statement July-December 1992. The pro-forma income statement is presented in Table 2.
2.c. New England Office Supplies balance sheet as of 31 December 1992: The balance sheet is presented in Table 3.
Table 1 - Cash Budget: July-December 1992
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