Using cash flow information—The Coca Cola Company Following are comparative statements of cash flows, as reported by The Coca Cola Company in its 2008 annual
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THE COCA COLA COMPANY AND SUBSIDIARIES |
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Consolidated Statements of Cash Flows |
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Year Ended December 31 (in millions) |
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2008 |
2007 |
2006 |
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Operating Activities (details omitted) |
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Net cash provided by operating activities |
$ 7,571 |
$ 7,150 |
$ 5,957 |
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Investing Activities |
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Acquisitions and investments, principally beverage |
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and bottling companies and trademarks |
(759) |
(5,653) |
(901) |
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Purchases of other investments |
(240) |
(99) |
(82) |
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Proceeds from disposals of bottling companies |
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and other investments |
479 |
448 |
640 |
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Purchases of property, plant, and equipment |
(1,968) |
(1,648) |
(1,407) |
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Proceeds from disposals of property, plant, |
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and equipment |
129 |
239 |
112 |
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Other investing activities |
(4) |
(6) |
(62) |
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Net cash used in investing activities |
(2,363) |
(6,719) |
(1,700) |
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Financing Activities |
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Issuances of debt |
4,337 |
9,979 |
617 |
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Payments of debt |
(4,308) |
(5,638) |
(2,021) |
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Issuances of stock |
586 |
1,619 |
148 |
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Purchases of stock for treasury |
(1,079) |
(1,838) |
(2,416) |
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Dividends |
(3,521) |
(3,149) |
(2,911) |
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Net cash provided by (used in) financing activities |
(3,985) |
973 |
$ (6,583) |
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Effect of Exchange Rate Changes on |
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Cash and Cash Equivalents |
(615) |
249 |
65 |
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Cash and Cash Equivalents |
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Net increase (decrease) during the year |
608 |
1,653 |
(2,261) |
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Balance at beginning of the year |
4,093 |
2,440 |
4,701 |
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Balance at end of year |
$ 4,701 |
$ 4,093 |
$ 2,440 |
Required:
a. Briefly review the consolidated statements of cash flows, and then provide an overall evaluation of the “big picture” during the three years presented for Coca Cola. Have operating cash flows been sufficient to meet investing needs and to pay dividends? b. Were there significant changes to any of the specific line item details that you think would require further explanation or analysis?