4. Cash flows "Cash Is King" for all businesses You can determine a company's cash situation by analyzing the cash flow statement. The cash flow statement also helps determine whether the company (1) is generating enough cash from its operations to make new investments and pay dividends or (2) will need to generate cash by issuing new debt or selling its assets. If a firm has lot of net cash flow, does that mean the firm's balance sheet cash account must be high? O Yes O No Three categories of activities (operating, investing, and financing) generate or use the cash flow in a company. In the following table, identify which type of activity is described by each statement. Operating Activity Investing Activity Financing Activity A company records a decrease in its total raw materials inventory from the previous year. A pharmaceutical company buys marketing rights to sell a drug exclusively in East Asian markets. The Yum chain of restaurants conducts an initial public offering to raise funds for expansion. Fitzi Chemical Co. earns revenue from its cash receipts from royalties. O Globo-Chem Co. reported net sales of $600 million last year and generated a net income of $132.00 million. Last year's accounts receivable increased by $17 million. What is the maximum amount of cash that Globo-Chem Co. received from sales last year? $583.00 million $437.25 million $149.00 million $291.50 million