The following data were included in a recent annual report of Warehouse Foods. Required a. Why is
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Required
a. Why is a companys net income typically less than its net cash flow from operating activities?
b. Why do most companies, including Warehouse Foods, typically have negative cash flows from investing activities?
c. Over the three-year period, what type of activity was the largest source of funds for Warehouse Foods? For what purpose were these fundsused?
Transcribed Image Text:
Year 1 Year 2 Year 3 15,400,000 15,000,000 3,800,000 3,00,000 8,700,000 12,600,000 Net income Net cash flow from operating activities 7,500,000 Net cash flow from investing activities (7,800,000) (41,00,000 Net cash flow from financing activities 15,200,000 17,500,000 (32,850,000)
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