The J.M. Smucker Company had net sales of $1,311 million from selling products such as jam (Smuckers), peanut butter (Jif), and vegetable oils (Crisco) for the year ending April 30, 2003. The income statement showed operating expenses of $1,147 million, other expenses of $9 million, and income taxes of $59 million. Assume depreciation and amortization affect operating expenses and that other noncash items affect other expenses. The company’s statement of cash flows, prepared under the indirect method, also contained the following items (where negative numbers represent cash outflows):

(in Millions)

Issuance of common stock ...........................................................$7

Dividends paid ............................................................................-34

Additions to property, plant, equipment .....................................-49

Business acquired ........................................................................-11

Disposal of property, plant, and equipment.................................7

Net income ....................................................................................96

Depreciation and amortization .......................................................34

Changes in operating assets and liabilities

Trade receivables .........................................................................-43

Inventories ....................................................................................-12

Accounts payable and accrued liabilities .......................................56

Income taxes ...................................................................................23

Other ...............................................................................................12

Prepare the statement of cash flows for J.M. Smucker using the direct method. Omit the schedule reconciling net income to net cash provided by operating activities.

Discuss the relation between operating cash flow and investing and financing needs.