Refer to the statements of cash flows for each of High Liner Foods and Shoppers Drug
Mart in Appendix II at the end of the textbook and answer the following questions.
a. High Liner Foods reported net income of $18,180,000 on its statement of cash flows and cash flows from operations of only $3,572,000—a decrease of $14,608,000. Shoppers Drug Mart shows the opposite on its statement of cash flows where the net income for the year ended December 31, 2011, was reported as $613,934,000 with cash flows from operations of $973,838,000—an increase of $359,904,000. Does this comparison indicate that there is something wrong with High Liner’s cash flows from operating activities?
b. High Liner Foods showed $263,923,000 as the cash provided by financing activities for the year ended December 31, 2011, while Shoppers Drug Mart showed cash used of $570,454,000 for the same period. Why would one company show cash provided by financing activities and another cash used by financing activities?