1. On your company's balance sheet at the end of last quarter, marketable securities for that period was $12.7 million. Marketable securities at the end of the current quarter is $9.2 million. What is the impact on cash flow of this change in marketable securities?
A. Cash flow between the two periods, and due only to marketable securities, must have risen by $3.5 million.
B. Cash flow between the two periods, and due only to marketable securities, must now be a decline of $9.2 million.
C. Cash flow between the two period, and due only to marketable securities, must have fallen by $3.5 million.
2. Which of the following is the best explanation (of the ones listed) for why Apple shows more than $170 billion in long term investments on its fiscal year 2016 balance sheet?
A) As both President Obama and President Trump has said several times, Apple is not patriotic. Company executives and board members do not care about the American people or the American economy.
B) Apple's basic business generates a lot of cash, plenty more than it needs for operations, and the company has chosen to keep much of this cash invested overseas due to costly tax consequences if it brings it back to the US.
C) Like many other large firms, Apple adds to its profits not only by making consumer goods and services, but by also making smart investments in stocks and bonds.