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book Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall cover

Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall

Edition 9ISBN: 0073527068
book Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall cover

Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall

Edition 9ISBN: 0073527068
Exercise 114
Step-by-step solution
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a.?For the three year period (in total), net cash provided by operations exceeded net cash used for investing activities and for the payment of dividends, although in 2007 net cash provided by operations was not sufficient to meet these payments, as follows (amounts in millions):

 

2008

2007

2006

Total

Net cash provided by operating activities

$ 7,571

$ 7,150

$ 5,957

$20,678

Net cash used in investing activities

(2,363)

(6,719)

(1,700)

(10,782)

Dividends paid

(3,521)

(3,149)

(2,911)

(9,581)

Net cash provided (used) by these items

$ 1,687

$(2,718)

$ 1,346

$    315 

It should be noted from the above table that the trend in net cash flows for these key items would be difficult to properly assess without having an understanding of reasons for the large amount of cash used for investing activities in 2007. 

The trend in net cash provided by operations is positive and shows a steady growth pattern.  Likewise, the trend in dividends paid suggests that Coca Cola has taken good care of its shareholders by providing an adequate increase in dividend payments each year. 


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Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall
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