Expand Your Critical Thinking 12-03 a

Amazon.com, Inc.s financial statements are presented in Appendix D. Click here to view Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Click here to view Appendix E. (a) Based on the information contained in these financial statements, compute free cash flow for Amazon at December 31, 2016 and Wal-Mart for January 31, 2017. (Show a negative free cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000). Enter amounts in millions.)

		Amazon.com, Inc.		Wal-Mart Stores, Inc.
Free cash flow		$Enter the amount in millions of dollars		$Enter the amount in millions of dollars

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2016 15,890 2,371 8,116 2,975 160 (20) (246) (829) 81 AMAZON.COM, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) Year Ended December 31, 2014 2015 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 8,658 $ 14.557 $ OPERATING ACTIVITIES: Net income (loss) (241) 596 Adjustments to reconcile net income foss) to net cash from operating activities: Depreciation of property and equipment, including internal-use software and website development, and other amortization, including capitalized content costs 4.746 6,281 Stock-based compensation 1,497 2,119 Other operating expense, net 129 155 Other expense (income), net 59 250 Deferred income taxes (316) Excess tax benefits from stock-based compensation (6) (119) Changes in operating assets and liabilities: Inventories (1,193) (2,187) Accounts receivable, net and other (1,039) (1,755) Accounts payable 1.759 4,294 Accrued expenses and other 706 913 Additions to unearned revenue 4.433 7,401 Amortization of previously uncarned revenue (3,692) (6,109) Net cash provided by (used in) operating activities 6,842 11,920 INVESTING ACTIVITIES: Purchases of property and equipment, including internal-use software and website development, net (4.893) (4.589) Acquisitions, net of cash acquired, and other (979) (795) Sales and maturities of marketable securities 3,349 3,025 Purchases of marketable securities (2.542) (4.091) Net cash provided by (used in) investing activities (5,065) (6.450) FINANCING ACTIVITIES: Excess tax benefits from stock-based compensation 119 Proceeds from long-term debt and other 6,359 353 Repayments of long-term debt and other (513) (1,652) Principal repayments of capital lease obligations (1,285) (2.462) Principal repayments of finance lease obligations (135) (121) Net cash provided by (used in) financing activities 4,432 (3.763) Foreign currency effect on cash and cash equivalents (310) (374) Net increase (decrease) in cash and cash equivalents 5,899 1,333 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 14,557 $ 15,890 $ SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for interest on long-term debt 91 $ 325 $ Cash paid for interest on capital and finance lease obligations 86 153 Cash paid for income taxes, net of refunds 177 273 Property and equipment acquired under capital leases 4,008 4,717 Property and equipment acquired under build-to-suit leases 920 544 (1,426) (3,367) 5,030 1,724 11,931 (9.976) 16,443 (6,737) (116) 4,733 (7,756) (9,876) 6 829 621 (354) (3.860) (147) (2.911) (212) 3,444 19,334 $ 290 206 412 5,704 1,209 See accompanying notes to consolidated financial statements. Wal-Mart Stores, Inc. Consolidated Statements of Cash Flow Fiscal Years Ended January 31, 2017 2016 2015 $ 14,293 $ 15,080 $ 17,099 (285) 14,293 15,080 16,814 10,080 761 206 9,454 (672) 1,410 9,173 (503) 785 (Amounts in millions) Cash flows from operating activities: Consolidated net income Income from discontinued operations, net of income taxes Income from continuing operations Adjustments to reconcile income from continuing operations to net cash provided by operating activities: Depreciation and amortization Deferred income taxes 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 Investment and business acquisitions, net of cash acquired Other investing activities Net cash used in investing activities (402) 1,021 3,942 1,137 492 31,530 (19) (703) 2,008 1,303 (472) 27,389 (569) (1,229) 2,678 1,249 166 28,564 (11,477) 635 246 (12,174) 570 671 (10,619) 456 662 (1,901) (2,463) (122) (13,987) (79) (10,675) (192) (11,125) Cash flows from financing activities: Net change in short-term borrowings Proceeds from issuance of long-term debt Payments of long-term 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 (1,673) 137 (2,055) (6,216) (8,298) (479) (90) (255) (18,929) 1,235 39 (4,432) (6,294) (4,112) (719) (1,326) (513) (16,122) (6,288) 5,174 (3,904) (6,185) (1,015) (600) (1,844) (409) (15,071) (514) Effect of exchange rates on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year (452) (1,838) 8,705 (1,022) (430) 9,135 $ 8,705 1,854 7,281 $ 9,135 $ 6,867 Supplemental disclosure of cash flow information: Income taxes paid Interest paid 4,507 2,351 8,111 2,540 8,169 2,433 See accompanying notes