1. The cash flows from operating activities show that depreciation is added to net income (loss) for the year. Is depreciation a source of cash? Explain.
2. Was the cash collected from customers during fiscal year 2012 higher or lower than Sun- Rype sales revenue for that year? Explain.
3. Did Sun- Rype expand during 2011 and 2012? If so, how did the company pay for its expansion? Explain.
4. Compute and analyze Sun- Rype quality of earnings ratio, capital expenditures ratio, and free cash flow for 2011 and 2012.
5. Analyze the company pattern of cash flows from operating, investing, and financing activities over the three years. What conclusion can you draw from the changing pattern of cash flows? Explain.
6. Obtain a copy of Sun- Rype statement of cash flows for the year 2013 through the company website (www.sunrype.com) or the SEDAR service (www.sedar.com). Did the company cash flow situation in 2013 improve or deteriorate relative to previous years? Explain.
7. As a potential investor in Sun- Rype shares, what additional information would you need before making your decision as to whether or not to invest in this company shares?