You are evaluating two companies as possible investments. The two companies, which are similar in size, are commuter airlines that fly passengers up and down the East Coast. All other available information has been analyzed, and your investment decision depends on the statements of cash flows.

A		B	C	D
Chattanooga Flights, Inc. Statements of Cash Flows 1 Years Ended November 30,2017 and 2016
2 3		2017		2016
	Operating activities:
4	Net income (net loss)		$ (63,000)		$ 160,000
5	Adjustments to reconcile net income(loss) to net cash provided by operating activities:
6	Total		79,000		(13,000)
7	Net cash provided by operating activities		16,000		147,000
8
9	Investing activities:
10	Purchase of property, plant,
11	and equipment	$ (67,000)		$ (140,000)
12	Sale of long-term investments	58,000		9,000
13	Net cash provided by (used for)
14	investing activities		(9,000)
15
16	Financing activities:
17	Issuance of short-term notes payable	$ 198,000		$ 218,000
18	Payment of short-term notes payable	(246,000)		(183,000)
19	Payment of cash dividends	(51,000)		(92,000)
20	Net cash provided (used) by financing activities		(99,000)		(57,000)1
21	Increase (decrease) in cash		$ (92,000)		$ (41,000)
22 ->-}	Cash balance at beginning of year Caeh r^alan^o afr nnrJ at /asr		106,000 1 <1 a nnn		BVriT.fiYil
24	LdSn Ddidnce at 6na ot year

Requirement
1. Discuss the relative strengths and weaknesses of Chattanooga Flights, Inc., and Eastern Airlines. Conclude your discussion by recommending one of the companies' stocks as an investment.

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Chattanooga Flights, Inc Statements of Cash Flows Years Ended November 30, 2017 and 2016 2017 2016 Operating activities: (63,000) 160,000 Net income (net loss) Adjustments to reconcile net income(loss) to net cash provided by operating activities: Total Net cash provided by operating activities 9,000 16,000 3,000) 147,000 Purchase of property, plant and equipment ale of long-term investments Net cash provided by (used for (67,000 58,000 S140000) 9,000 investing activities (9,000) 131,000) Financing activities: Issuance of short-term notes payable Payment of short-term notes payable Payment of cash dividends Net cash provided (used by financing activities s 198,000 1246,000) 51,000 218,000 (183 (57,000 1 ,000) 147,000 5 106,000 Increase (decrease) in cash Cash balance at beginning of year Cash balance at end of year 2,000) 106,000 Eastern Airlines Statements of Cash Flows Years Ended September 30, 2017 and 2016 2017 2016 Operating activities: $ 264,000 193,000 Net income Adjustments to reconcile net income to net cash provided by operating activities: 79,000 272,000 67,000 Total Net cash provided by operating activities Investing activities Purchase of property, plant and equipment Sale of property, plant, and equipment Net cash used for investing activities s (395,000! 69,000 5(610,000) 119,000 326,000) (491,000) Financing activities: Issuance of long-term notes payable Payment of short-term notes payable Net cash provided by financing activities 198,000 (95,000) ー(26,0001 ncrease (decrease) in cash Cash balance at beginning of year Cash balance at end of year 103,000105,000 $(114,000 290,000 $108,000