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Question
Condensed financial data of Sauder Company appear below:
Additional information:
1. New plant assets costing $85,000 were purchased for cash in 2012.
2. Old plant assets costing $25,000 were sold for $5,000 cash when book value was $13,000.
3. Bonds with a face value of $20,000 were converted into $20,000 of common stock.
4. A cash dividend of $24,000 was declared and paid during the year.
5. Accounts payable pertain to merchandise purchases.
Instructions
1. Prepare a statement of cash flows for the year using the direct method.
2. Compute the following cash basis ratios:
a. Current cash debt coverage ratio
b. Cash debt coverage ratio
Answer
This answer is hidden. It contains 149 characters.
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