Identify the major investing and financing transactions for each firm for the three years presented. Additionally, for each firm, indicate what the primary source of cash flows has been in the years presented (looking at all sections of the statement). Use your judgment to determine what is major and primary. Analysis: For each firm, compute and interpret the interest coverage ratio (as defined in the class) and cash flow adequacy ratio for the most recent year. (Interest Expense for Firm A is $84,566 and for Firm B is $1,417.) For each firm, compute and interpret the quality of earnings ratio for the most recent year. Discuss any weaknesses of the ratio as a measure of the actual quality of earnings. ded Analysis: Indicate which, if any, of these firms are at risk of having inadequate cash flows to continue operations. Briefly discuss the factors you considered in your analysis. For each of the firms, indicate which phase of the company's life cycle you believe it is in (introduction, growth, maturity, or decline). Briefly discuss the reasons for your conclusion. FIRMA CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Year End December FR 1998 1991 Operating Activities Net loss $ (719,968) $(124,546) $ (31,020) Adjustments to reconcile net loss to net cash provided (used) in operating activities: Depreciation and amortization of fixed assets 36,806 9,421 3.442 Amortization of deferred stock-based compensation 30,618 2,386 1.354 Equity in losses of equity-method investees 76.769 2,905 Amortization of goodwill and other intangibles 214,694 42,599 Non-cash merger, acquisition, and investment related costs 8,072 1,561 Non-cash revenue for advertising and promotional services (5,837 Loss on sale of marketable securities 8.688 271 Non-cash interest expense 29.171 23,970 Net cash used in operating activities before changes in operating assets and liabilities (320,987) (41,433) (26,160) Changes in operating assets and liabilities, net of effects from acquisitions Inventories (172,069) (20,513) (8,400) Prepaid expenses and other current assets (60,628) (16,758) (3.055) Accounts payable.... 330,166 78,674 30,172 Accrued expenses and other current liabilities 65.121 21.615 5.274 Accrued advertising 42.382 9,617 2,856 Deferred revenue 262 Interest payable 24,878 (167 Net cash provided by changes in operating assets and liabilities, net of elfects from acquisitions 230,112 72,468 26,847 Net cash provided (used) in operating activities (90.875) 31.035 687 Investing Activities Sales and maturitics of marketable securities 4,024,551 332,084 4.311 Purchases of marketable securities (4,290,173) (546,509) (122,385) Purchases of fixed assets.. (287,055) (28,333) (7.603) Acquisitions and investments in businesses, net of cash acquired (369,607 (19,019) Net cash used in investing activities (922.284) (261.777) (125,677) Financing Activities Proceeds from issuance of capital stock and exercise of stock options 64.469 14,366 Proceeds from long-term debt 53,358 1.263,639 325,987 75,000 Repayment of long-term debt (188,886) (78,108) (47) Financing costs (35.151 (17,783) (2,309 Net cash provided by financing activities 1,104,071 254.462 126,002 Effect of exchange rate changes 489 (35) Net increase in cash 91,401 23,685 1,012 Cash at beginning of period 25.561 1.876 Cash at end of period $116.962 $ 25,561 1.876 Supplemental Cash Flow Information: Fixed assets acquired under capital leases 25.850 $ $ Fixed assets acquired under financing agreements 3.463 5,608 Stock issued in connection with business acquisitions 1.500 774,409 Equity securities of other companies received for non-cash revenue 217,241 for advertising and promotional services.. 54,402 Cash paid for interest, net of amounts capitalized 59.688 26,629 326 See accompanying notes to consolidated financial statements FIRM B CONSOLIDATED STATEMENTS OF CASH FLOWS fin millions) Sear Ended December 1916 2017 16,1755 19,9345 5 21,856 2371 301 10,073 116 2,975 160 (20) 046) 11.478 4.215 202 (292) (29) 15.341 5,418 274 219 441 (1426) 0.436) 5030 1.724 1.955 0.583) (4.780) 7.100 28 735 (1314) (4.615) 3,263 472 1.151 30,723 17.203 18365 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD OPERATING ACTIVITIES Net income Adjustments to reconcile net income to net cash from operating activities Depreciation of property and equipment and other amortization, including capitalized content costs Stock-based compensation Other operating expensent Other expense (income), net Deferred income taxes Changes in operating assets and liabilities Inventories Accounts receivable, not and other Accounts payable Accrued expenses and other Uncarned revenue Net cash provided by (used in) operating activities INVESTING ACTIVITIES Purchases of property and equipment Proceeds from property and equipment incentives Acquisitions, nd of cash acquired, and other Sales and maturities of marketable securities Purchases of marketable securities Net cash provided by (used in) investing activities FINANCING ACTIVITIES Proceeds from long-term debt and other Repayments of long-term debt and other Principal repayments of capital lease obligations Principal repayments of finance lease obligations Net cash provided by used in financing activities Foreign currency effect on cash, cash equivalents, and restricted cash Net increase (decrease in cash, cash equivalents, and restricted cash CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD SUPPLEMENTAL CASH FLOW INFORMATION Cash paid for interest on long-term det Cash paid for interest on capital and finance lease obligations Cash paid for income taxes, act of refunds Property and equipment acquired under capital cases Property and equipment acquired under build-to-siteases 07.00) 1067 (116) 4577 0.240) 09.516) (11.955) 1.897 (13.972) 9,677 (12.731) (27,054) (13,427) 2.104 2.186 240 (7.100) (12.369 16.228 (1.300) 615 027) . (147 0,716) 212) 3.759 19.9345 (200) 9928 713 1,932 218565 765 (665) (7.419) 0337) (7.686) 051) 10.317 32.173 $ 5 2905 206 412 5.704 3355 319 957 9.637 3.541 R$4 525 1.154 10,615 3.611