Elements of the Statement of cash flows

Read and complete case study 10-10, “Eat at My Restaurant” in your text. Address the following elements, which are also required elements at the end of the case study:

• Comment on the difference between net cash provided by operating activities and net income. Speculate on which number is likely to be the better indicator of long-term profitability.
• Comment on the data reviewed for each firm.
• Do any of these firms appear to have a cash flow problem?

Your answers should be in an essay form with an introduction and conclusion; ensure you are addressing each element clearly and thoroughly, following these guidelines:

• Requirement (a) of the problem should be answered in general terms; you do not need to consider the 3 firms in the case. However, you do need to make a choice and rationalize that choice.
• When addressing requirement (b), you should make AT LEAST 4 observations on each firm, focusing on the cash flow ratios provided.
• All information should be considered when answering requirement (c). Even if you don’t think any one company is “in trouble,” you should still choose a company and support your choice.