Variation in cash flows OBJ. 7 Mattel, Inc., designs, manufactures, and markets toy products worldwide. Mattel’s toys include Barbie™ fashion dolls and accessories, Hot Wheels™, and Fisher-Price brands.

For a recent year, Mattel reported the following net cash flows from operating activities

(in thousands):

First quarter ending March 30 $ 171,506 Second quarter ending June 29 (232,557)

Third quarter ending September 29 (40,109)

Fourth quarter ending December 30 986,778 Explain why Mattel reported negative net cash flows from operating activities during the second and third quarters and a large positive cash flow for the fourth quarter, with overall net positive cash flow for the year.