We used Figure $1\mathrm{.}1$ to demonstrate the distinction between a firm's internal vs$.$ external sources of

financing. Use the Worldwide Sporting Good's example to discuss your overall assessment of the

firm's cash flows and its sources of funding.

Suppose you want to use the firm's income statement as an approximation for its cash flow from

operations. What are the two key issues we raised in class with this type of approach? Do these issues

seem to be significant in this case?

FIGURE $1\mathrm{.}1$ The Cash Flow$-$Production Cycle

Copyratt O MoGraw$-$ta Edicabon Al noths mesered. Wo resroduction prop

detitudion whoul De pricr seriten corsert of MuGraw Hil Edscalon

Worldwide Sports Balance Sheet, December $31,2017($$ thousands$)$

$$