Reading Apple Computer’s Statement of Cash Flows The following items appeared in the Investing Activities section of Apple Computer’s 2008 statement of cash fl ows. (All amounts are in millions of dollars.)

2008 2007 2006 Purchases of short-term investments $(22,965) $(11,719) $(7,255)

Proceeds from maturities of short-term investments 11,804 6,483 7,226 Proceeds from sales of short-term investments 4,439 2,941 1,086 Purchases of long-term investments (38) (17) (25)

Required 1. What amount did Apple spend in 2008 to purchase short-term investments? How does this amount compare to the amounts spent in the two prior years?

2. What amount did Apple receive from investments that matured in 2008? How does this amount compare to the amounts received in the two prior years?

3. The third line in the preceding excerpt reports proceeds from sales, rather than maturities, of short-term investments. Why would certain types of investments mature while others would be sold?

AppendixLO1