a. What amounts does the company report for net income and cash from operating activities? What one item explains most of this difference? Why does the company add these amounts in the computation of operating cash flows?

b. Thermo Fisher Scientific reports a positive amount of $181 million relating to noncash stock-based compensation. What does this positive amount signify?

c. Thermo Fisher Scientific reports a cash outflow of $758 million relating to the acquisition of PPE. Is this cash outflow a cause for concern? Explain. Did the company dispose of any PPE during 2018? How do we know?

d. Thermo Fisher Scientifics net cash flows from financing activities is $(2,237) million. For what purposes is Thermo Fisher Scientific using this cash?

e. Calculate the operating cash flow to current liabilities ratio and the operating cash flow to capital expenditures ratio. Current liabilities were $6,147 million in 2018 and $7,048 million in 2017. What do these ratios measure?

f. The cash balance increased by $756 million during the year. Does Thermo Fisher Scientific present a healthy cash flow picture for the year? Explain.

THERMO FISHER SCIENTIFIC INC. Consolidated Statement of Cash Flows 2018 $2,938 2,267 (379) 181 106 (366) (324) 54 201 (42) (93) 4,543 For Year Ended December 31, $ millions Operating Activities Net Income.... Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization. Change in deferred income taxes.. Noncash stock-based compensation. Other noncash expenses, net. Changes in assets and liabilities, excluding the effects of acquisitions: Accounts receivable .... Inventories Other assets Accounts payable Other liabilities Contributions to retirement plans Net cash provided by operating activities. . Investing Activities Acquisitions, net of cash acquired . Purchase of property, plant and equipment .... Proceeds from sale of property, plant and equipment. Other investing activities, net.... Net cash used in investing activities. .. Financing Activities Net proceeds from issuance of debt. . Repayment of debt........ Proceeds from issuance of commercial paper Repayments of commercial paper ... Purchases of company common stock. Dividends paid.. Net proceeds from issuance of company common stock under employee stock plans... Other financing activities ... Net cash (used in) provided by financing activities.... Exchange Rate Effect on Cash .... Increase in Cash, Cash Equivalents and Restricted Cash... Cash, Cash Equivalents and Restricted Cash at Beginning of Period. Cash, Cash Equivalents and Restricted Cash at End of Period.. (536) (758) 50 (9) (1,253) 690 (2,052) 5,060 (5,254) (500) (266) 136 (51) (2,237) (297) 756 1,361 $2,117