The statement of cash ï¬ows for Circuit City (www .circuitcity.com) for the ï¬scal years ending February 28
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Required:
(a) How would a supplier interpret this data?
(b) How would a current or potential investor interpret this data?
(c) How would an employee interpret this data?
(d) Use Internet resources to determine what happened to Circuit City in 2008 and thereafter. Discuss the occurrences in relationship to the cash ï¬ows statements presented in this problem.
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2008 2007 2006 Operating Activities: Net (loss) earnings Adjustments for noncash $ (321.4 (8.4 145.1 items: Depreciation expense Amortization expense Write-off of goodwill 183.4 92.0 gain on dispositions of PP&E Provision for deferred income taxes 27.6 Other noncash changes Changes in current assets and liabilities: Accounts receivable, net Merchandise inventory Prepaid expenses and 45.8 84.4 (133.1 49.4 (231.1) (9.6) (17.3) (19.2)73.3211.4 5.9 other current assets Other assets .5 ccounts payable Expenses payable 55.7 Accrued expenses & other operating liabilities(19.1)_(82.8)26.2 Cash Flow from Operating Activities Investing Activities: (45.6) S 316.3 364.9 Purchases of property and equipment (325.4) (285.7 (254.5) Proceeds from sales of Purchases of investment Sales and maturities of property and equipment 38.6 55.4 securities (2,649.7) (2,002.1) (1,409.8) investment securities Other investing activities Cash Flow from Investing 3,246.3 ,926. 1,015.0 Activities Financing Activities: Proceeds from short-term S 341.2 (334.7) (593.9) borrowings 276.2 35.7 Principal payments on short-term borrowings Debt issuance costs Proceeds from long-term (275.6) (56 debt Principal payments on long-term debt Repurchases of common stock (46.8) (237.4) (338.5) 38.0 (26.8) (20. (12.8) (24.4) Issuances of common stock 89.7 Dividends paid Other financing activities Cash Flow from Financing Activities $(157.9) S (160.8) S (318.4) Exchange Rate Effect on Cash & Disc. Operations Increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents 154.9 174.8) (563.7) 141.1 36.0 879.7 at end of year S 296. 1411 316.0
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