Response to the following problem:
Time Warner Inc. (Time Warner) is a media and entertainment company that includes America Online, cable systems, film entertainment, television networks, and publishing. The following operating results (in millions) are for the years ending December 31:
2004 2003
Net cash flows from operating activities $6,618 $6,601
Net income 3,364 2,639
a. Compute the ratio of cash flow to net income for each year. Round to one decimal place.
b. Is there a significant difference between the ratios for 2004 and 2003? If so, what are some possible causes for the difference?