Barnes & Noble is a retailer of content, digital media, and educational products.  It has nearly 700 bookstores in 50 states and also has a large e-commerce presence on the Web.  In the past few years, there has been speculation that Barnes & Noble will not survive in the long-term. Among other news stories, the Wall Street Journal reported on November 26, 2013, that B & N sales are eroding for both print books and e-books. U.S. News & World Report reported that sales of the Barnes & Noble Nook plunged.

Let’s see what the statement of cash flows can tell us about Barnes & Noble’s operations.

The 2012 Annual Report for Barnes & Noble can be found here.  See pages 32 – 33 of the annual report for the Statement of Cash Flows.

Using the 2012 Fiscal Statement of Cash Flows for Barnes & Noble, answer the questions to follow.

Questions:

1)      Did Barnes & Noble use the indirect method or the direct method to prepare its statement of cash flows? How do you know?

2)      For fiscal 2012, did Barnes & Noble’s operating activities provide cash or use cash?  How much?

3)      For fiscal 2012, did Barnes & Noble’s  investing activities provide cash or use cash?  How much?  What investing activities used cash?  What investing activities provided cash?

4)      For fiscal 2012, did Barnes & Noble’s financing activities provide cash or use cash?  How much?  What financing activities used cash?  What financing activities provided cash?

5)      What conclusion(s) can you draw solely from Barnes & Noble’s statement of cash flows for fiscal 2012?