Can a firm with positive net income run out of cash? Explain XYZ reclassified $385 billion of operating expenses as capitalexpenditures. Explain the effect this reclassification would haveon XYZ's cash flows (Hint: consider taxes). XYZ's actionswere illegal and clearly designed to deceive investors. But if afirm could legitimately choose how to classify an expense for taxpurposes, which choice is truly better for the firm'sinvestors?