Amazon.com, Inc.'s financial statements are presented in Appendix D. Click here to view Appendix D. Financial statements of Walmart, Inc. are presented in Appendix E. Click here to view Appendix E. The complete annual reports of Amazon and Walmart, including the notes to the financial statements, are available at each company's respective website. (a) Based on the information contained in these financial statements, compute free cash flow for each company. (Enter answers in millions. Show amounts that decrease cash flow with either a - sign e.g. 15,000 or in parenthesis e.g. (15,000).) Consolidated Statements of Cash Flows (in millions) CASH, CASH EQUTVAIENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD OPERATING ACTIVITIES: Net income Adjustments to reconcile net income to net cash from operating activities: Depreciation of property and equipment and other amortization, including capitalized content costs Stoek-based compensation Other operating expense, net Other expense (income), net Deferred income taxes 8,1162,975160(20)(246)11,4784,215202(292)(29)15,3415,418274219441 Changes in operating assets and liabilities: Inventories Accounts receivable, net and other Accounts payable Accrued expenses and other Unearned revenue Net cash provided by (used in) operating activities \begin{tabular}{rrr} (1,426) & (3,583) & (1,314) \\ (3,436) & (4,780) & (4,615) \\ 5,030 & 7,100 & 3,263 \\ 1,724 & 283 & 472 \\ 1,955 & 738 & 1,151 \\ \hline 17,203 & 18,365 & 30,723 \end{tabular} INVESTING ACTIVITIES: Purchases of property and equipment Proceeds from property and equipment incentives Acquisitions, net of cash acquired, and other Sales and maturities of marketable securities Purchases of marketable securities Net cash provided by (used in) investing activities \begin{tabular}{ccc} (7,804) & (11,955) & (13,427) \\ 1,067 & 1,897 & 2,104 \\ (116) & (13,972) & (2,186) \\ 4,577 & 9,677 & 8,240 \\ (7,240) & (12,731) & (7,100) \\ \hline(9,516) & (27,084) & (12,369) \end{tabular} FINANCING ACTIVITIES: Proceeds from long-term debt and other Repayments of long-term debt and other Principal repayments of capital lease obligations See accompanying notes to consolidated financial statements. Amazon.com, Inc. Consolidated Statements of Operations (in millions, except per share data) Operating expenses: Amazon.com, Inc. Consolidated Statements of Onerations Amazon.com, Inc. Consolidated Statements of Comprehensive Income (in millions) Amazon.com, Inc. Consolidated Statements of Stockholders' Equity (in millions) Amazon.com, Inc. Consolidated Statements of Stockholders' Equity (in millions) Balance as of January 1,2016 Net income Other comprehensive income (loss) Exercise of common stock options Excess tax benefits from stock-based compensation Stock-based compensation and issuance of employee benefit plan stock Balance as of December 31,2016 Cumulative effect of a change in accounting principle related to stock- based compensation Net income Other comprehensive income (loss) Exercise of common stock options Stock-based compensation and issuance of employee benefit plan stock Balance as of December 31,2017 Cumulative effect of changes in accounting principles related to revenue recognition, income taxes, and financial instruments Net income Other comprehensive income (loss) Exercise of common stock options Stock-based compensation and (4) - (547) - issuance of employee benefit plan stock Balance as of December 31,2018 $5$(1,837)5,402 See accompanying notes to consolidated financial statements. Walmart Inc. Consolidated Statements of Income Net income per common share: BasicnetincomepercommonshareattributabletoWalmartDilutednetincomepercommonshareattributabletoWalmart$2.282.263.293.28$4.40 Weighted-average common shares outstanding: Basic 2,9292,9953,101 Weighted-average common shares outstanding: Walmart Inc. Consolidated Balance Sheets LIABILITIES AND EQUTTY Current liabilities: Short-term borrowings Accounts payable Accrued liabilities Accrued income taxes Long-term debt due within one year Capital lease and financing obligations due within one year Total current liabilities \begin{tabular}{rr} $5,225 & $5,257 \\ 47,060 & 46,092 \\ 22,159 & 22,122 \\ 428 & 645 \\ 1,876 & 3,738 \\ 729 & 667 \\ \hline 77,477 & 78,521 \end{tabular} \begin{tabular}{|l|rr|} \hline Long-term debt & 43,520 & 30,045 \\ \hline Long-term capital lease and financing obligations & 6,683 & 6,780 \\ \hline Deferred income taxes and other & 11,981 & 8,354 \end{tabular} Commitments and contingencies Equity: See accompanying notes. Walmart Inc. Consolidated Statements of Shareholders' Equity Other operating activities Changes in certain assets and liabilities, net of effects of acquisitions: Receivables, net Inventories Accounts payable Accrued liabilities Accrued income taxes Net cash provided by operating activities Cash flows from investing activities: Payments for property and equipment Proceeds from the disposal of property and equipment Proceeds from the disposal of certain operations Purchase of available for sale securities Payments for business acquisitions, net of eash acquired Other investing activities Net cash used in investing activities Cash flows from financing activities: Net change in short-term borrowings Proceeds from issuance of long-term debt Repayments of long-term debt Premiums paid to extinguish debt Dividends paid Purchase of Company stock Dividends paid to noncontrolling interest Purchase of noncontrolling interest Other financing activities Net cash used in financing activities \begin{tabular}{rrr} (53) & 4,148 & (1,673) \\ 15,872 & 7,476 & 137 \\ (3,784) & (13,061) & (2,055) \\ - & (3,059) & - \\ (6,102) & (6,124) & (6,216) \\ (7,410) & (8,296) & (8,298) \\ (431) & (690) & (479) \\ - & (8) & (90) \\ (629) & (261) & (398) \\ \hline \hline(2,537) & (19,875) & (19,072) \end{tabular} Effect of exchange rates on cash, cash equivalents and restricted cash Effect of exchange rates on cash, cash equivalents and restricted cash (438)487 Net increase (decrease) in cash, cash equivalents and restricted cash Cash, cash equivalents and restricted cash at beginning of year Cash, cash equivalents and restricted cash at end of period \begin{tabular}{rrr} 742 & (130) & (1,747) \\ 7,014 & 8,8917,144 \\ \hline$7,756 & $7,104 & $7,144 \\ \hline \end{tabular} Supplemental disclosure of cash flow information: Income taxes paid Interest paid See accompanying notes. Amazon.com, Inc.'s financial statements are presented in Appendix D. Click here to view Appendix D. Financial statements of Walmart, Inc. are presented in Appendix E. Click here to view Appendix E. The complete annual reports of Amazon and Walmart, including the notes to the financial statements, are available at each company's respective website. (a) Based on the information contained in these financial statements, compute free cash flow for each company. (Enter answers in millions. Show amounts that decrease cash flow with either a - sign e.g. 15,000 or in parenthesis e.g. (15,000).) Consolidated Statements of Cash Flows (in millions) CASH, CASH EQUTVAIENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD OPERATING ACTIVITIES: Net income Adjustments to reconcile net income to net cash from operating activities: Depreciation of property and equipment and other amortization, including capitalized content costs Stoek-based compensation Other operating expense, net Other expense (income), net Deferred income taxes 8,1162,975160(20)(246)11,4784,215202(292)(29)15,3415,418274219441 Changes in operating assets and liabilities: Inventories Accounts receivable, net and other Accounts payable Accrued expenses and other Unearned revenue Net cash provided by (used in) operating activities \begin{tabular}{rrr} (1,426) & (3,583) & (1,314) \\ (3,436) & (4,780) & (4,615) \\ 5,030 & 7,100 & 3,263 \\ 1,724 & 283 & 472 \\ 1,955 & 738 & 1,151 \\ \hline 17,203 & 18,365 & 30,723 \end{tabular} INVESTING ACTIVITIES: Purchases of property and equipment Proceeds from property and equipment incentives Acquisitions, net of cash acquired, and other Sales and maturities of marketable securities Purchases of marketable securities Net cash provided by (used in) investing activities \begin{tabular}{ccc} (7,804) & (11,955) & (13,427) \\ 1,067 & 1,897 & 2,104 \\ (116) & (13,972) & (2,186) \\ 4,577 & 9,677 & 8,240 \\ (7,240) & (12,731) & (7,100) \\ \hline(9,516) & (27,084) & (12,369) \end{tabular} FINANCING ACTIVITIES: Proceeds from long-term debt and other Repayments of long-term debt and other Principal repayments of capital lease obligations See accompanying notes to consolidated financial statements. Amazon.com, Inc. Consolidated Statements of Operations (in millions, except per share data) Operating expenses: Amazon.com, Inc. Consolidated Statements of Onerations Amazon.com, Inc. Consolidated Statements of Comprehensive Income (in millions) Amazon.com, Inc. Consolidated Statements of Stockholders' Equity (in millions) Amazon.com, Inc. Consolidated Statements of Stockholders' Equity (in millions) Balance as of January 1,2016 Net income Other comprehensive income (loss) Exercise of common stock options Excess tax benefits from stock-based compensation Stock-based compensation and issuance of employee benefit plan stock Balance as of December 31,2016 Cumulative effect of a change in accounting principle related to stock- based compensation Net income Other comprehensive income (loss) Exercise of common stock options Stock-based compensation and issuance of employee benefit plan stock Balance as of December 31,2017 Cumulative effect of changes in accounting principles related to revenue recognition, income taxes, and financial instruments Net income Other comprehensive income (loss) Exercise of common stock options Stock-based compensation and (4) - (547) - issuance of employee benefit plan stock Balance as of December 31,2018 $5$(1,837)5,402 See accompanying notes to consolidated financial statements. Walmart Inc. Consolidated Statements of Income Net income per common share: BasicnetincomepercommonshareattributabletoWalmartDilutednetincomepercommonshareattributabletoWalmart$2.282.263.293.28$4.40 Weighted-average common shares outstanding: Basic 2,9292,9953,101 Weighted-average common shares outstanding: Walmart Inc. Consolidated Balance Sheets LIABILITIES AND EQUTTY Current liabilities: Short-term borrowings Accounts payable Accrued liabilities Accrued income taxes Long-term debt due within one year Capital lease and financing obligations due within one year Total current liabilities \begin{tabular}{rr} $5,225 & $5,257 \\ 47,060 & 46,092 \\ 22,159 & 22,122 \\ 428 & 645 \\ 1,876 & 3,738 \\ 729 & 667 \\ \hline 77,477 & 78,521 \end{tabular} \begin{tabular}{|l|rr|} \hline Long-term debt & 43,520 & 30,045 \\ \hline Long-term capital lease and financing obligations & 6,683 & 6,780 \\ \hline Deferred income taxes and other & 11,981 & 8,354 \end{tabular} Commitments and contingencies Equity: See accompanying notes. Walmart Inc. Consolidated Statements of Shareholders' Equity Other operating activities Changes in certain assets and liabilities, net of effects of acquisitions: Receivables, net Inventories Accounts payable Accrued liabilities Accrued income taxes Net cash provided by operating activities Cash flows from investing activities: Payments for property and equipment Proceeds from the disposal of property and equipment Proceeds from the disposal of certain operations Purchase of available for sale securities Payments for business acquisitions, net of eash acquired Other investing activities Net cash used in investing activities Cash flows from financing activities: Net change in short-term borrowings Proceeds from issuance of long-term debt Repayments of long-term debt Premiums paid to extinguish debt Dividends paid Purchase of Company stock Dividends paid to noncontrolling interest Purchase of noncontrolling interest Other financing activities Net cash used in financing activities \begin{tabular}{rrr} (53) & 4,148 & (1,673) \\ 15,872 & 7,476 & 137 \\ (3,784) & (13,061) & (2,055) \\ - & (3,059) & - \\ (6,102) & (6,124) & (6,216) \\ (7,410) & (8,296) & (8,298) \\ (431) & (690) & (479) \\ - & (8) & (90) \\ (629) & (261) & (398) \\ \hline \hline(2,537) & (19,875) & (19,072) \end{tabular} Effect of exchange rates on cash, cash equivalents and restricted cash Effect of exchange rates on cash, cash equivalents and restricted cash (438)487 Net increase (decrease) in cash, cash equivalents and restricted cash Cash, cash equivalents and restricted cash at beginning of year Cash, cash equivalents and restricted cash at end of period \begin{tabular}{rrr} 742 & (130) & (1,747) \\ 7,014 & 8,8917,144 \\ \hline$7,756 & $7,104 & $7,144 \\ \hline \end{tabular} Supplemental disclosure of cash flow information: Income taxes paid Interest paid See accompanying notes