Solution to BTN-Chapter 12 - Reporting in Action BTN 12-1 1...

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Reporting in Action — BTN 12-1 1. Apple uses the indirect method of reporting operating cash flows. We readily know this because the operating activity section of the cash flow statement starts with net income, and makes adjustments for items such as depreciation and changes in working capital. 2. In all three fiscal years, Apple’s cash flows from operating activities markedly exceed its cash dividends paid, as shown in the table below: ($ millions) Fiscal 2012 Fiscal 2011 Fiscal 2010 Cash provided by operating activities ....... $50,856 $37,529 $18,595 Cash dividends paid .................................... (2,488) (0) (0) 3. In fiscal 2012, the largest item in reconciling the difference between net income and cash flow from operations was the change (increase) in accounts receivable of $5,551 million. In fiscal 2011, the largest item in reconciling the difference between net income and cash flow from operations was the change (increase) in other current and non-current liabilities of $4,495 million. In fiscal 2010, the largest item in reconciling the difference between net income and cash flow from operations was the change (increase) in accounts payable $6,307 million.
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