Reference no: EM132563912
Question 1: Sears lost over $2 billion last year and over $1 billion the year before. However, looking at their Statement of Cash Flows, they somehow managed to increase their cash balance position $50 million. Explain how this was accomplished. Also, explain how the CEO could justify that this shows that Sears is in position to make a big turnaround.
Net Income -383,000
Operating Activities, Cash Flows Provided By or Used In
Depreciation 378,000
Adjustments To Net Income -2,753,000
Changes In Accounts Receivables
Changes In Liabilities -1,057,000
Changes In Inventories 1,144,000
Changes In Other Operating Activities 829,000
Total Cash Flow From Operating Activities -1,842,000
Investing Activities, Cash Flows Provided By or Used In
Capital Expenditures -80,000
Investments 293,000
Other Cash flows from Investing Activities 1,681,000
Total Cash Flows From Investing Activities 1,894,000
Financing Activities, Cash Flows Provided By or Used In
Dividends Paid
Sale Purchase of Stock
Net Borrowings 41,000
Other Cash Flows from Financing Activities
Total Cash Flows From Financing Activities -2,000
Effect Of Exchange Rate Changes
Change In Cash and Cash Equivalents 50,000