Apple's Cash Flow Statements (2016) The purpose of the Statement of Cash Flows is to help users assess the liquidity flows of the fim. Some users (e.g., creditors) find it to be the most important of the three major financial statements. The questions below consider Apple's Cash Flow Statements for fiscal 2016, i.e., the year ended September 24, 2016. The questions below are a test of your understanding of these statements Questions: 1. Are Apple's Cash Flow Statements prepared using the direct or indirect method? 2. What section(s) of the statement are affected by this method? 3. Why is 'net income listed as a source of cash inflows in the Operating activities section? 4 Why is depreciation and amortization' listed as a source of cash inflows in the Operating activities section? 5 Why are changes in accounts receivable, net' of S1,095 added for fiscal 2016 in the Operating activities section, while $4,232 is subtracted in fiscal 2014? 6. Why are changes in 'inventories' of $217 added in fiscal 2016 in the Operating activities section, while they are subtracted in fiscal 2015 and 2014? Why are changes in accounts payable added in each fiscal year in the Operating activities section? 8. Why are changes in 'deferred revenue of S1,554 subtracted in fiscal 2016 in the Operating activities section, while larger amounts are added in fiscal 2015 and 2014? What balance sheet account(s) does this relate to? Apple's Cash Flow Statements pa 9. What are Apple's largest two ivesting activities in fiscal 2016? 10. What are Apple's largest two financing activities in fiscal 2016? 11. In your opinion, do Apple's Cash Flow Statements capture the liquidity picture for the company? How else can you assess liquidity