Refer to the following financial statements for Crosby Corporation:
a) Prepare a statement of cash flows for the Crosby Corporation using the general procedures indicated in Table 2–10.
b) Describe the general relationship between net income and net cash flows from operating activities for the firm.
c) Has the buildup in plant and equipment been financed in a satisfactory manner? Briefly discuss.
d) Compute the book value per common share for both 20X1 and 20X2 for the Crosby Corporation.
e) If the market value of a share of common stock is 3.3 times book value for 20X1, what is the firm’s P/E ratio for 20X2?

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Sales. Cost of goods sold. Gross profits. Selling and administrative expense. Depreciation expense. Operating income Interest expense Earnings before taxes. Taxes. Earnings after taxes. Preferred stock dividends. CROSBY CORPORATION Income Statement For the Year Ended December 31, 20X2 Earnings available to common stockholders. Shares outstanding Earnings per share. Retained earnings, balance, January 1, 20X2 Add: Earnings available to common stockholders, 20X2...... Deduct: Cash dividends declared and paid in 20X2. Retained earnings, balance, December 31, 20X2. Inventory Prepaid expenses Total current assets Current assets: Cash Accounts receivable (net). Statement of Retained Earnings For the Year Ended December 31, 20X2 Net plant and equipment. Total assets... Investments (long-term securities) Plant and equipment. Current liabilities: Less: Accumulated depreciation. Comparative Balance Sheets. For 20X1 and 20X2 Long-term liabilities: Accounts payable. Notes payable. Accrued expenses. Total current liabilities. Stockholders' equity: Bonds payable, 20X2. Total liabilities. Assets $2,200,000 1,300,000 900,000 420,000 150,000 330,000 90,000 240,000 80,000 160,000 10,000 $ 150,000 120,000 $1.25 Preferred stock, $100 par value. Common stock, $1 par value. Capital paid in excess of par Retained earnings. Total stockholders' equity Total liabilities and stockholders' equity $500,000 150,000 Liabilities and Stockholders' Equity 50,000 $600,000 Year-End 20X1 $ 70,000 300,000 410,000 50,000 830,000 80,000 Year-End 20X2 $100,000 350,000 430,000 30,000 2,000,000 2,400,000 1,000,000 1,150,000 1,000,000 1,250,000 $1,910,000 $2,230,000 910,000 70,000 $ 250,000 400,000 70,000 720,000 70,000 790,000 $ 440,000 400,000 50,000 890,000 120,000 1,010,000 90,000 90,000 120,000 120,000 410,000 410.000 500,000 600,000 1,120,000 1,220,000 $1,910,000 $2,230,000