following the acquisition of kraft during year 8 the philip morris companies release 536453

PHILIP MORRIS COMPANIES, INC.

Balance Sheets ($ millions)

December 31, Year 8 and Year 7

Year 8

Year 7

Assets

Cash and cash equivalents

$ 168

$ 90

Accounts receivable

2,222

2,065

Inventories

5,384

4,154

Current assets

7,774

6,309

Property, plant, and equipment, net

8,648

6,582

Goodwill, net

15,071

4,052

Investments.

3,260

3,665

Total assets

$34,753

$20,608

Liabilities and Stockholders” Equity

Short-term debt

$ 1,259

$ 1,440

Accounts payable

1,777

791

Accrued liabilities

3,848

2,277

Income taxes payable

1,089

727

Dividends payable

260

213

Current liabilities

8,233

5,448

Long-term debt

17,122

6,293

Deferred income taxes

1,719

2,044

Stockholders” equity

7,679

6,823

Total liabilities and stockholders” equity

$34,753

$20,608

PHILIP MORRIS COMPANIES, INC.

Income Statement ($ millions)

For Year Ending December 31, Year 8

Sales

$ 31,742

Cost of goods sold

(12,156)

Selling and administrative expenses

(14,410)

Depreciation expense

(654)

Goodwill amortization

(125)

Interest expense

(670)

Pretax income

3,727

Income tax expense

(1,390)

Net income

$ 2,337

PHILIP MORRIS PURCHASE OF KRAFT

Allocation of Purchase Price ($ millions)

Accounts receivable

$ 758

Inventories

1,232

Property, plant, and equipment

1,740

Goodwill

10,361

Short-term debt

(700)

Accounts payable

(578)

Accrued liabilities.

(530)

Long-term debt

(900)

Purchase price (net of cash acquired)

$11,383