Question
(AMOUNTS IN MILLIONS) Year 4 Year 3 Year 2 Year 1 Year 0 OPERATIONS Net Income (loss) $1,861 $1,198 $ (344) $ (201) $3,087 Depreciation
| (AMOUNTS IN MILLIONS) | Year 4 | Year 3 | Year 2 | Year 1 | Year 0 |
| OPERATIONS | |||||
| Net Income (loss) | $1,861 | $1,198 | $ (344) | $ (201) | $3,087 |
| Depreciation and amortization | 1,549 | 1,528 | 1,689 | 1,828 | 1,376 |
| Deferred income taxes | 68 | 75 | 13 | 19 | 1 |
| Other additions (Subtractions) | (179) | (469) | 709 | (68) | (2,141) |
| (Increase) Decrese in accounts receivable | |||||
| (Increase) Decrease in accounts invetories | (238) | (197) | (114) | 958 | (372) |
| (Increase) Decrease in inventories | (272) | (194) | (39) | 482 | (372) |
| (Increase) Decrease in prepayments | 134 | (183) | 191 | (235) | 56 |
| Increase (Decrease) in accounts pauable | (71) | 264 | (81) | (687) | 246 |
| Increase (Decrease) in other current liabilities | 294 | 129 | (32) | (277) | 309 |
| Cash Flow from Operations | $3,146 | $2,151 | $1,992 | $1,819 | $2,185 |
| INVESTING | |||||
| Fixed assets acquired | $(1,298) | $(800) | $(802) | $(1,790) | $(2,762) |
| Change in marketable securities | 145 | 86 | (238) | 164 | 834 |
| Acquisition of businesses | (8) | (128) | (69) | ---- | (3) |
| Other investing transactions | ---- | ---- | ---- | ---- | 107 |
| Cash Flow from Investing | $(1,161) | $(842) | $(1,109) | $(1,626) | $(1,824) |
| FINANCING | |||||
| Increase in short-term borrowing | ---- | ---- | $ 9 | ---- | $23 |
| Increase in long-term borrowing | ---- | ---- | ---- | 3 | 250 |
| Issue of common stock | 192 | 157 | 167 | 183 | 242 |
| Decrease in short-term borrowing | (6) | (8) | (16) | (3) | (19) |
| Decrease in long-term borrowing | (429) | (418) | (22) | (132) | (307) |
| Acquistion of common stock | (753) | (284) | (370) | (395) | (155) |
| Dividends | (154) | (147) | (147) | (147) | (141) |
| Other financing transactions | 15 | 260 | 14 | (16) | (290) |
| Cash Flow from Financing | $(1,135) | $(440) | $(365) | $(507) | $(397) |
| Change in Cash | $850 | $869 | $518 | $(314) | $(36) |
| Cash - Beginning of Year | 1,818 | 949 | 431 | 745 | 781 |
| Cash - End of Year | $2,668 | $1,818 | $949 | $431 | $745 |
| Change in sales from previous year | +27.9% | +17.3% | +2.2% | -30.9% | -1.9% |
Question: Analyze the above data.
(a) Discuss the relatons/changes between net income and cash flow. Analysis should include changes in comparative results from operating, investing, and financing activities.
(b) Indicate which itmes were the largest inflow AND the largest outflow from each category (operating, investing, and financing).
(c) Indicate whether the change in cash positively or negatively correlated with the change in cash.
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Auditing In The Public Sector Efficiency Economy And Program Results
Authors: James L. Savage, Felix Pomeranz, Alfred J. Cancellieri, Joseph B. Stevens
1st Edition
0882621238, 978-0882621234
