Assignment - Project Financing Management - China IV

One to Two pages Required to answer these Questions in APA form All essay questions require full, grammatically correct sentences which include your reasoning and/or explanation. Write your answers in a separate Word file. Do NOTwrite them in an Excel worksheet. Below is the corresponding Excel file that you will need in order to answer the following Essay Questions: SEE ATTACHED FILE: China IV - Excel Document (86 KB) 1. The rule-of-thumb in evaluating the cash flows of an organization is: a. The cash flows from operations should be positive, and increasing each year, and ideally should be sufficient to cover any negative cash flows from investing activities. b. How would you evaluate China Trade in terms of cash flows, in light of this rule-of-thumb measure? 2. China Trade's income statement (after adjusting for depreciation expense and adjusting entries) shows net income of $300. Yet, its cash flows from operations were a negative $3,000. What caused a $300 accrual basis profit to become a $3,000 "loss" in terms of cash flows from operations? Hint: See the Compare worksheet.