1. Which type of reporting format method does Apple use for its Statement of Cash Flows?

1. Direct or Indirect

2. How did you determine this?

2. Within the Operating Activities section: Identify 2 items that are non-cash expenses:

1. _________________

2. ________________

3. Why does this adjustment need to be made?

3. Payments made in connection with business acquisitions are reported in which section?

4. Apple issued common stock. In which section is this reported? Why?

Apple Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS In millions) Years ended September 24, Cash and cash equivalents, begining of the year 20 289 $ 20,484 $ Operating actviies Net incame 59.531 48 351 45 687 Adjustmerts to recancie net incame to cash generated by aperating actvites 0,157 4.840 5.966 0.903 10.505 4 210 4.938 Derred income tax expenselbeneft) Oher 32.590) Changes in aperating assets and liablites: Aocounts recevable, net 2.093) 2.723) 4.254) 5.318) 8,966 217 Vendor nontrade receivables Oher currert and non-current assets Accounts payable (8,010) (423) 1,055 (1,554) 1905 66 231 Oher currert and non-current liabiliies 38.490 Cash generated by operating activiies 64 225 Investing acdvities: Purchases d marketable securiies Proceeds fram maturides of marketable securities Proceeds fram sales of makeable securiies Payments far acquisitian of praperty, plant and equipment Payments made in connection with business aquisitions, ne Purchases d non-marketable securidies Proceeds fram nan-marketable securties Oher 71 356) 55,881 47 838 (13.313) (159 486) 1,775 94 564 (12.451) 142 428) 21 258 90,535 (12.734) (721) (1.388) 353 Cash generated by used in) invesing aciviies 16.066 6 446 45 977 Financing actviies Proceeds fram issuance of comman slock Payments far taxes related to net share selemert of equity awards Payments far dvidends and dividend equivalents Repurchases df common stodk Proceeds fram issuance oftem debt, net Repaymerts of term debt Change in cammercial paper, ne 495 (1570) 12.150 (29,722) 24,954 2527) 13,712) 72,738) 6.969 (6,500) (1,874) (12.769 (32.900) 28,662 3500) 3.852 Cash used in nancing actvities 87 876) 20,890 IncreaselDecrease) in cash and cash equivalents Cash and cash equivalents, end of the year Supplemertal cash flow disdlosure 5.624 (635) 20 289 $ Cash paid for income taxes, net Cash paid for interest 10,417 $ 3,022 $ 11591 $ See accompanying Notes to Consolidsted Financial Statements Apple Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS In millions) Years ended September 24, Cash and cash equivalents, begining of the year 20 289 $ 20,484 $ Operating actviies Net incame 59.531 48 351 45 687 Adjustmerts to recancie net incame to cash generated by aperating actvites 0,157 4.840 5.966 0.903 10.505 4 210 4.938 Derred income tax expenselbeneft) Oher 32.590) Changes in aperating assets and liablites: Aocounts recevable, net 2.093) 2.723) 4.254) 5.318) 8,966 217 Vendor nontrade receivables Oher currert and non-current assets Accounts payable (8,010) (423) 1,055 (1,554) 1905 66 231 Oher currert and non-current liabiliies 38.490 Cash generated by operating activiies 64 225 Investing acdvities: Purchases d marketable securiies Proceeds fram maturides of marketable securities Proceeds fram sales of makeable securiies Payments far acquisitian of praperty, plant and equipment Payments made in connection with business aquisitions, ne Purchases d non-marketable securidies Proceeds fram nan-marketable securties Oher 71 356) 55,881 47 838 (13.313) (159 486) 1,775 94 564 (12.451) 142 428) 21 258 90,535 (12.734) (721) (1.388) 353 Cash generated by used in) invesing aciviies 16.066 6 446 45 977 Financing actviies Proceeds fram issuance of comman slock Payments far taxes related to net share selemert of equity awards Payments far dvidends and dividend equivalents Repurchases df common stodk Proceeds fram issuance oftem debt, net Repaymerts of term debt Change in cammercial paper, ne 495 (1570) 12.150 (29,722) 24,954 2527) 13,712) 72,738) 6.969 (6,500) (1,874) (12.769 (32.900) 28,662 3500) 3.852 Cash used in nancing actvities 87 876) 20,890 IncreaselDecrease) in cash and cash equivalents Cash and cash equivalents, end of the year Supplemertal cash flow disdlosure 5.624 (635) 20 289 $ Cash paid for income taxes, net Cash paid for interest 10,417 $ 3,022 $ 11591 $ See accompanying Notes to Consolidsted Financial Statements