Gap Inc. operates chains of retail clothing stores under the names of Gap, Banana Republic, and Old Navy. Exhibit 3.19 presents the statement of cash flows for Gap for Year 0 to Year 4.

REQUIRED
Discuss the relations between net income and cash flow from operations and among cash flows from operating, investing, and financing activities for the firm over the five-year period. Speculate on reasons for the more significant increases and decreases.

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Exhibit 3.19 (Continued) FINANCING $ 621 Increase in short-term borrowing Increase in long-term borrowing Issue of capital stock Decrease in short-term borrowing Decrease in long-term borrowing Acquisition of capital stock Dividends 85 1,346 1,194 250 130 26 153 139 152 (42) (735) (871) (668) (250) (976) (1) (393) (79) (76) (11) $ 260 $ 627 (79) (78) (75) Other financing transactions Cash Flow from Financing Change in Cash Cash-Beginning of year (11) $ 544 $ (41) 28 27 $ (608) $ (766) 3,027 $ 2,261 $(1,796) $ (16) $1,406 $2,020 2,261 1,007 380 421 Cash-End of Year $ 2,245 $3,027 $1,007 $ 380 Change in sales from previous year +2.6% +9.7% +4.4% +1.3% +17.5% %24 | %24