Find Starbucks’ 2011 statement of cash flows either on Starbucks Web site or using the SEC’s EDGAR database.
1. Did Starbucks’ net cash provided by operating activities increase or decrease between the years ended October 3, 2010, and the year ended October 2, 2011? By how much? What item contributed most to the change?
2. Did Starbucks’ net cash used by investing activities increase or decrease between the years ended October 3, 2010, and the year ended October 2, 2011? By how much? What was the major cause of the change?
3. Explain to someone who’s not an accountant what Starbucks did with the $1,612.4 million of cash generated by operating activities during the year ended October 2, 2011.
4. Suppose a friend of yours commented, “Starbucks must have poor financial management. It made a profit of $1,248.0 million in the year ended October 2, 2011, and it generated $1,612.4 million in cash from operations, yet it paid only $389.5 million in dividends. Its shareholders should expect more.” Respond to your friend’s comment.