$($Analyzing the quality of firm$$ earnings$)$Kabutell$,$ Inc. had net income of $ $800$ comma $000,$ cash flow from financing activities of $ $80$ comma $000,$ depreciation expenses of $ $50$ comma $000,$ and cash flow from operating activities of $ $600$ comma $000.$

a$.$Calculate the quality of earnings ratio. What does this ratio tell$$ you?

b$.$Kabutell$,$ Inc. reported the following in its annual reports for $2011$dash$2013$:

$($$ million$)$

$2011$

$2012$

$2013$

$$Cash Flow from Operations

$$$$480$

$$$$401$

$$$$472$

$$Capital Expenditures$($CAPEX$)$

$$$$461$

$$$$445$

$$$$454$

$($Click on the icon in order to copy its contents into a spreadsheet.$)$

Calculate the average capital acquisitions ratio over the$$ three$-$year

period. How would you interpret these$$ results?

$.$What is$$ Kabutell's quality of earnings$$ ratio?

$$

enter your response here$\%($Round to one decimal$$ place.$)$

Part $2$

What does this ratio tell$$ you?$($Select the best choice$$ below.$)$

A$.$

$$Kabutell$\text{'}$s reported net income was $75\mathrm{.}0$ percent of the$$ firm's cash flow from operations. The firm depends mainly on$$ non$-$operating source of cash to generate its net income.

B$.$

$$Kabutell$\text{'}$s cash flow from operations was $75\mathrm{.}0$ percent of the$$ firm's reported net income. The firm depends mainly on$$ non$-$operating source of cash to generate its net income.

C$.$

$$Kabutell$\text{'}$s cash flow from operations was $75\mathrm{.}0$ percent of the$$ firm's reported net income. The firm depends mainly on operating source of cash to generate its net income.

D$.$

$$Kabutell$\text{'}$s reported net income was $75\mathrm{.}0$ percent of the$$ firm's cash flow from operations. The firm depends mainly on operating source of cash to generate its net income.

Part $3$

b$.$What is$$ Kabutell's average capital acquisitions ratio over the$$ three$-$year period?

$$

enter your response here$\%($Round to one decimal$$ place.$)$

Part $4$

How would you interpret these$$ results?$($Select the best choice$$ below.$)$

A$.$

$$Consequently$,$ for the past three$$ years, Kabutell was on average able to finance $99\mathrm{.}5$ percent of its new expenditures for plant and equipment out of the$$ firm's current$-$year operations.

B$.$

$$Consequently$,$ for the past three$$ years, Kabutell was on average able to finance $99\mathrm{.}5$ percent of its new expenditures for plant and equipment out of the$$ firm's issuance of debt.

C$.$

$$Consequently$,$ for the past three$$ years, Kabutell was on average able to finance $99\mathrm{.}5$ percent of its new expenditures for plant and equipment out of the$$ firm's issuance of common stock.

D$.$

$$Consequently$,$ for the past three$$ years, Kabutell was on average able to finance $99\mathrm{.}5$ percent of its new expenditures for plant and equipment out of the$$ firm's sales of fixed assets.