The financial statements of Apple Inc. are presented in Appendix A. Click here to view Appendix A. Answer the following questions. (a) What was the amount of net cash provided by operating activities for the year ended September 30, 2017? For the year ended September 24, 2016? (Enter amounts in millions.) 2016 2017 Net cash provided by operating activities (in millions) $ led by operating activities (in millions) $ 63596 $ 65824 (b) What was the amount of increase or decrease in cash and cash equivalents for the year ended September 30, 2017? (Enter amount in millions.) Decrease in cash and cash equivalent $ 195 million (c) Which method of computing net cash provided by operating activities does Apple use? Indirect method (d) From your analysis of the September 30, 2017, statement of cash flows, was the change in accounts receivable a decrease or an increase? Change Increase Was the change in inventories a decrease or an increase? Change Increase Was the change in accounts payable a decrease or an increase? Change Increase (e) What was the net cash used by investing activities for the year ended September 30, 2017? (Enter amount in millions.) Net cash used by investing activities $ 46446 i million (f) What was the amount of interest paid in the year ended September 30, 2017? (Enter amount in millions.) Amount of interest paid $ 2092 i million What was the amount of income taxes paid for the same period? (Enter amount in millions.) Amount of income taxes paid $ 11591 i million Apple Inc. CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except number of shares which are reflected in thousands and per share amounts) September 30, 2017 229,234 141,048 88,186 $ Net sales Cost of sales Gross margin Years ended September 24, 2016 215,639 131,376 84,263 $ September 26, 2015 233,715 140,089 93,626 Operating expenses: Research and development Selling, general and administrative Total operating expenses 11,581 15,261 26,842 10,045 14,194 24,239 8,067 14,329 22,396 Operating income Other income/expense), net Income before provision for income taxes Provision for income taxes Net income 61,344 2,745 64,089 15,738 48,351 60,024 1,348 61,372 15.685 45,687 71,230 1,285 72,515 19,121 53,394 $ $ $ Earnings per share: Basic Diluted 9.27 9.21 $ $ 8.35 8.31 $ $ 9.28 9.22 Shares used in computing earnings per share: Basic Diluted 5,217,242 5,251,692 5,470,820 5,500,281 5,753,421 5,793,069 Cash dividends declared per share $ 2.40 $ 2.18 $ 1.98 See accompanying Notes to Consolidated Financial Statements. Apple Inc. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In millions) September 30, 2017 48,351 Years ended September 24, 2016 45,687 September 26, 2015 53,394 $ Net income Other comprehensive income/(loss): Change in foreign currency translation, net of tax effects of $(77), $8 and $201, respectively 224 75 (411) 1,315 2,905 Change in unrealized gains/losses on derivative instruments: Change in fair value of derivatives, net of tax benefit/(expense) of $(478). $(7) and $(441), respectively Adjustment for net (gains) losses realized and included in net income, net of tax expense/(benefit) of $475, $131 and $630, respectively Total change in unrealized gains/losses on derivative instruments, net of tax (1,477) (162) (741) (734) (3,497) (592) (782) 1,582 (483) Change in unrealized gains/losses on marketable securities: Change in fair value of marketable securities, net of tax benefit/(expense) of $425, S(863) and $264, respectively Adjustment for net (gains) losses realized and included in net income, net of tax expense/(benefit) of $35, $(31) and $(32), respectively Total change in unrealized gains/losses on marketable securities, net of tax (64) 56 1,638 59 (424) (846) Total other comprehensive income/loss) Total comprehensive income (784) 47,567 979 46,666 (1,427) 51,967 $ $ See accompanying Notes to Consolidated Financial Statements. CONSOLIDATED BALANCE SHEETS (In millions, except number of shares which are reflected in thousands and par value) September 30, 2017 September 24, 2016 ASSETS: $ $ Current assets: Cash and cash equivalents Short-term marketable securities Accounts receivable, less allowances of $58 and $53, respectively Inventories Vendor non-trade receivables Other current assets Total current assets 20,289 53,892 17,874 4,855 17,799 13,936 128,645 20,484 46,671 15,754 2,132 13,545 8,283 106,869 Long-term marketable securities Property, plant and equipment, net Goodwill Acquired intangible assets, net Other non-current assets Total assets 194,714 33,783 5,717 2,298 10,162 375,319 170,430 27,010 5,414 3,206 8,757 321,686 $ $ LIABILITIES AND SHAREHOLDERS' EQUITY: $ Current liabilities: Accounts payable Accrued expenses Deferred revenue Commercial paper Current portion of long-term debt Total current liabilities 49,049 25,744 7,548 11,977 6,496 100,814 37,294 22,027 8,080 8,105 3,500 79,006 Deferred revenue, non-current Long-term debt Other non-current liabilities Total liabilities 2,836 97,207 40,415 241,272 2,930 75,427 36,074 193,437 Commitments and contingencies Shareholders' equity: Common stock and additional paid-in capital, $0.00001 par value: 12,600,000 shares authorized; 5,126,201 and 5,336,166 shares issued and outstanding, respectively Retained earnings Accumulated other comprehensive income/loss) Total shareholders' equity Total liabilities and shareholders' equity 35,867 98,330 (150) 134,047 375,319 31,251 96,364 634 128,249 321,686 $ See accompanying Notes to Consolidated Financial Statements. Apple Inc. CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (In millions, except number of shares which are reflected in thousands) Common Stock and Additional Paid-In Capital Shares Amount 5,866,161 $ 23,313 Accumulated Other Comprehensive Income/(Loss) 1,082 Retained Earnings 87,152 53,394 $ (1,427) Total Shareholders' Equity $ 111,547 53,394 (1,427) (11,627) (36,026) 3,586 (11,627) (36,026) (325,032) 3,586 37,624 (231) (609) (840) 748 27,416 5,578,753 92,284 45,687 Balances as of September 27, 2014 Net income Other comprehensive income/(loss) Dividends and dividend equivalents declared Repurchase of common stock Share-based compensation Common stock issued, net of shares withheld for employee taxes Tax benefit from equity awards, including transfer pricing adjustments Balances as of September 26, 2015 Net income Other comprehensive income/(loss) Dividends and dividend equivalents declared Repurchase of common stock Share-based compensation Common stock issued, net of shares withheld for employee taxes Tax benefit from equity awards, including transfer pricing adjustments Balances as of September 24, 2016 Net income Other comprehensive income/(loss) Dividends and dividend equivalents declared Repurchase of common stock 748 119,355 45,687 979 (12,188) (29,000) 4,262 (12,188) (29,000) (279,609) 4,262 37,022 (806) (419) (1,225) 379 31,251 5,336,166 96,364 48,351 379 128,249 48,351 (784) (12,803) (33,001) (784) (12,803) (33,001) (246,496) 4,909 - 4,909 36,531 (913) (581) (1,494) Share-based compensation Common stock issued, net of shares withheld for employee taxes Tax benefit from equity awards, including transfer pricing adjustments Balances as of September 30, 2017 620 35,867 620 134,047 5,126,201 $ $ 98,330 $ (150) $ See accompanying Notes to Consolidated Financial Statements. Apple Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) September 30, 2017 20,484 Years ended September 24, 2016 21,120 September 26, 2015 Cash and cash equivalents, beginning of the year 13,844 48,351 45,687 53,394 Operating activities: Net income Adjustments to reconcile net income to cash generated by operating activities: Depreciation and amortization Share-based compensation expense Deferred income tax expense Other Changes in operating assets and liabilities: Accounts receivable, net Inventories Vendor non-trade receivables Other current and non-current assets 10,157 4,840 5,966 (166) 10,505 4,210 4,938 486 11.257 3,586 1,382 385 527 217 (51) (2,093) (2,723) (4,254) (5,318) 9,618 (626) (154) 63,598 417 (238) (3,735) (283) 5,001 1,042 Accounts payable Deferred revenue Other current and non-current liabilities Cash generated by operating activities 1,055 1,837 (1,554) (2,033) 65,824 9,058 81,266 Investing activities: Purchases of marketable securities Proceeds from maturities of marketable securities Proceeds from sales of marketable securities Payments made in connection with business acquisitions, net Payments for acquisition of property, plant and equipment Payments for acquisition of intangible assets Payments for strategic investments, net Other Cash used in investing activities Financing activities: Proceeds from issuance of common stock (159,486) 31,775 94,564 (329) (12,451) (344) (395) 220 (46,446) (142,428) 21,258 90,536 (297) (12,734) (814) (1,388) (110) (45,977) (166,402) 14,538 107,447 (343) (11,247) (241) (26) (56,274) 555 495 543 749 (1,499) (11,561) (35,253) 27,114 Excess tax benefits from equity awards Payments for taxes related to net share settlement of equity awards Payments for dividends and dividend equivalents Repurchases of common stock Proceeds from issuance of term debt, net Repayments of term debt Change in commercial paper, net Cash used in financing activities Increase/(Decrease) in cash and cash equivalents Cash and cash equivalents, end of the year 627 (1,874) (12,769) (32,900) 28,662 (3,500) 3,852 (17,347) (195) 20,289 407 (1,570) (12,150) (29,722) 24,954 (2,500) (397) (20,483) (636) 20,484 2,191 (17,716) 7.276 21,120 $ $ $ Supplemental cash flow disclosure: Cash paid for income taxes, net Cash paid for interest 11,591 2,092 See accompanying Notes to Consolidated Financial Statements. $ $ 10,444 1,316 $ $ 13,252 514