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Unformatted text preview: 1 (c) Mikhail Pevzner and George Mason University Statement of Cash Flows Chapter 13-Libby et al. (c) Mikhail Pevzner and George Mason University Statement of Cash Flows It is helpful to users of financial information to know how a firm generates and expends its cash. Users want to see most cash coming from normal course of business. Users want to see that accounting income a firm reports corresponds to the actual cash flows. (c) Mikhail Pevzner and George Mason University Statement of Cash Flows Change in Cash during the period= Cash Flow from Operating Activities+ Cash Flow from Investing Activities+ Cash Flow from Financing Activities 2 (c) Mikhail Pevzner and George Mason University T H E G A P, IN C . C O N SO L ID A TE D ST A T EM E NT S O F C A SH F L O W S ($ in mil ions) 53 We ks Ended February 3, 20 7 52 We ks Ended January 28, 2006 52 We ks Ended January 29, 20 5 C ash Flo ws from O peratin g Ac tiv ities: Net ea rn ings $ 778 $ 1,1 13 $ 1 ,1 50 Ad ju stm ents to reconcile net ea rn in gs to n et ca sh prov id ed by o perating ac tivities: D ep rec ia tion and a m ortization (a) 530 6 25 615 S ha re-b ased co m pensation 54 2 2 5 T ax b enefit fro m exercise of stock options a nd v esting of service aw ards 25 1 9 31 E xces tax ben efit from exercise o f sto ck o ption s (23 ) O th er non-ca sh item s 11 (6 9) 21 D efer ed in com e tax es (41 ) (4 6 ) (80 ) C hang e in op erating a s ets an d liabilities: M erchand ise in ven to ry (97 ) 1 14 (90 ) O th er as ets 12 (1 04) (18 ) A cco un ts pa yable (25 ) (1 02 ) 39 A ccru ed exp enses a nd oth er cur ent liab ilities 75 (1 21) (23 ) Inc om e taxes p ayab le, net (102 ) (1 9 ) (1 12 ) L ease inc entives and other lia bilities 53 1 19 59 N et cash p ro vided b y op era tin g activities 1 ,250 1,5 51 1 ,5 97 C ash Flo ws from Inv estin g A ctiv ities: Pu rc hase of p roperty and equipm en t (572 ) (6 00 ) (4 19 ) Proceed s fro m sale of prop ert y and equ ip m ent 22 2 7 Pu rc hase of sh ort-term investm en ts (1 ,460 ) (1,768 ) (1 ,813 ) M aturities of sh ort-term investm en ts 1 ,841 1,6 45 2 ,0 72 Pu rc hase of long -term in vestm en ts (1 00 ) M aturities of lon g-term in vestm ents 1 00 C hang e in restricted ca sh 11 9 59 337 C hang e in other as ets 8 2 3 6 N et cash p rovided b y (used for) in vestin g activities (150 ) 2 86 183 C ash Flo ws from F in anc in g Ac tiv ities: Paym en ts of lo ng-term deb t (8 71 ) Proceed s fro m share-ba sed c om p ensation 190 1 39 154 Pu rc hase of treasu ry stoc k (1 ,050 ) (2,000 ) (1 ,000 ) Exc es tax b en efit from ex erc ise of stock options 23 C ash dividend s paid (265 ) (1 79 ) (79 ) N et cash u sed for finan cin g activities (1 ,102) (2,040) (1 ,796 ) E f ect of ex chan ge rate flu ctuations on cash (3 ) (7 ) N et decrease in cash a nd ca sh equ ivalents (5) (2 10) (16 ) C ash and cash equiva len ts at b egin ning of p erio d 2 ,035 2,2 45 2 ,2 61 C ash and cash equiva len ts at end of period...
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