The Railroad Companies of Pacific Union and Central Pacific Were

question 33

Essay

The railroad companies of Pacific Union and Central Pacific were both built with massive government subsidies often on a per-mile basic in the late 19^th century, which created railroad monopolies. Both failed soon after completion of their lines. The Great Northern railroad took much longer to build since it was completed without government subsidies. It turned out to be much more successful than either Pacific Union or Central Pacific. What could account for this apparent disparity?

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Definitions:

Operating Activity

Activities that relate directly to the business’s primary operations, such as selling goods and providing services, not including investing or financing activities.

Direct Method

A way of preparing the cash flow statement where actual cash flows from operating activities are listed, opposed to adjusting net income for indirect factors.

Net Cash Flows

The total amount of cash and cash-equivalents being transferred into and out of a business.