Discuss cash and cash equivalents. How important arethe items that fall within this category to the successfuloperations of a company?
Discuss cash and cash equivalents. How important arethe items that fall within this category to the successfuloperations of a company?
Related questions
Selected information (CAD millions) are presented for two firms ROP and DUL, operating in the same industries:
| DUL | ROH | |
| Net income | $ 4,529 | $ 161 |
| Net cash provided by operating activities | 6,539 | 212 |
| Net cash provided (used) by investing activities | (1,420) | 35 |
| Net cash provided (used) by financing activities | 735 | (176) |
| Net increase in cash and cash equivalents | $ 5,854 | $ 71 |
| Cash and cash equivalents, beginning of year | $ 2,078 | $ 267 |
| Cash and cash equivalents, end of year | $ 7,932 | $ 338 |
Required:
i) Compare and discuss the performance / activity the two companies based on the above Cash Flow and Net Income information.
ii) Which company appears to be in a stronger Cash position? Why?
