Question

What were operating cash flows of Toyota for years data is available? b. Suppose that during those years Toyota also increased its net working capital and capital spending. Together with your answer to part (a), how would all that be possible? In other words, how did Toyota finance its investments and/or operating losses (if there were any)? Explain

2017-12 2016-12 3,845 2,228 1,617 7,932 4,160 3,772 2018-12 11,270 5,623 5,647 864 2,575 1,201 4,640 -3,023 334 1,201 4,787 1,864 7,852 -4,080 479 1,505 5,233 1,942 8,680 -3,033 648 -16 Toyota Cash FlowFlag INCOME STATEMENT Fiscal year ends in December. USD in millions except per share data. Revenue Cost of revenue Gross profit Operating expenses Research and development Sales, General and administrative Other operating expenses Total operating expenses Operating income Interest Expense Other income (expense) Income before taxes Provision for income taxes Other income Net income from continuing operations Net income from discontinuing ops Other Net income Preferred dividend Net income available to common shareholders Earnings per share Basic Diluted Weighted average shares outstanding Basic Diluted 139 -3,218 28 -4,575 -542 4,993 1,312 283 -42 -4,033 987 -3,246 2,876 10 -370 -4,033 997 -941 1,938 -370 -4,033 0 1 بن بن 0 1 1,459 1,526 1,459 1,526 1,459 1,526 Depreciation & amortization 347 510 426

Answer 1

Ans part a]

Cash Flow Statement

Operating Cash Flow    In USMn$

Partaiculars Years -->	2016	2017	2018
Net Earnings	-370	-4033	997
Add Depreciation & Amortisation	347	510	426
Less Changes in Working Capital Accounts Recivables Inventory Less Accounts Payable	NA	NA	NA
Cash from operations	?	?	?

As the data related to Accounts Receivables, Inventory and Accounts Payables for three years i.e 2016,17 &18 is not available we can not arrive at actual figures of Cash from operations. But I have shown here working that how to find out cash from operations.

Ans part b]

Now we can go further to find out part b that how Toyota financed its investments and/or operating losses. We don't have balance data available for that but we will show how to arrive the cash flow in totality as below --

Let us continue above table from Cash from operations

Partaiculars Years -->	2016	2017	2018
Cash from operations	?	?	?
Less Investing Cash Flow Cash invested in assets	?	?	?
Cash from financing Issuance(+)/Repayment of Loans Issuance(+)/Repayment of Equity	?	?	?
Net Increase/ Decrease in Cash	?	?	?

In this way we can come to know that how the Toyota has financed its assets and/or operating losses.

Let us summarise it again ---

First we will take net earning for the year and will add back depreciation/amortisation expenses being non cash expenses and then we will adjust changes in working capital. The changes in working capital we will calculate by adding Accounts Receivables and Inventory and deducting from it Accounts Payable. Thus we will arrive at Cash from operations

Then from Cash from operations we will deduct cash invested in various assets. Then we will add cash received from issuance of loans or equity and will deduct cash paid for repayment of loan or equity. Thus we will arrive at increase/decrease in cash for the year