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Determine orozco corporations current cash debt coverage

Assignment Help Managerial Accounting
Reference no: EM13520198

A comparative balance sheet for Orozco Corporation is presented below.

1623_Determine Orozco Corporations current cash debt.PNG

Additional information:

1. Net income for 2012 was $105,000.

2. Cash dividends of $40,000 were declared and paid.

3. Bonds payable amounting to $50,000 were retired through issuance of common stock.

Instructions

(a) Prepare a statement of cash flows for 2012 for Orozco Corporation.

(b) Determine Orozco Corporation's current cash debt coverage ratio, cash debt coverage ratio, and free cash flow. Comment on its liquidity and financialflexibility.

Reference no: EM13520198

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