Theater by Design and Showcase Cinemas are asking you to recommend their stock to your clients. Because Theater by Design and Showcase earn about the same net income and have similar financial positions, your decision depends on their cash flow statements, summarized as follows:

Requirement
1. Based on their cash flows, which company looks better? Give yourreasons.

Transcribed Image Text:

Theater by Design $ 30,000 Showcase Cinemas S 70,000 Net cash provided by operating activitics Cash provided by (used for) investing activitics: Purchase of plant assets Sale of plant assets Cash provided by (used for) financing activities: Issuance of common stock Paying off long-term debt Net increase in cash S(20,000) 40,000 $(100,000) 10,000 20,000 (90,000) 30,000 (40,000) $ 10,000 S 10,000