a) Cash flow statement b) activity ratios and liquidity

Paulson Corporation's unadjusted trial balance at December 1, 2012, is presented 1. Debit Credit Cash $ 22,000 Accounts Receivable 36,800 Notes Receivable 10,000 Interest Receivable -0- Inventory H 36,200 Prepaid Insurance 3,600 Land 20,000 D Buildings 150,000 Equipment 60,000 Patent Fatem 9,000 Allowance for Doubtful Accounts 500 Accumulated Depreciation-Buildings Accum 50,000 24,000 Accumulated Depreciation Equipment Accounts Payable 27,300 Salaries and Wages Payable Notes Payable (due April 30, 2013) -0- v 11,000 Interest Payable -0- Notes Payable (due in 2018) 35,000 Common Stock 50,000 63,600 Retained Earnings Dividends 12,000 Sales Revenue 900,000 Interest Revenue -0- Gain on Disposal of Plant Assets -0- Red DeLa Bad Debts Expense -0- A Cost of Goods Sold Dauk 630,000 Depreciation Expense -0- Insurance Expense -0- Interest Expense -0- Other Operating Expenses 61,800 Amortization Expense -0- Salaries and Wages Expense 110,000 Total $1,161,400 $1,161,400 The following transactions occurred during December. Dec. 2 Paulson purchased equipment for $16,000, plus sales taxes of $800 (all paid in cash). 2 Paulson sold for $3,500 equipment which originally cost $5,000. Accumulated depreciation on this equipment at January 1, 2012, was $1,800; 2012 depreciation prior to the sale of equipment was $450. 15 Paulson sold for $5,000 on account inventory that cost $3,500. 23 Salaries and wages of $6,600 were paid. Adjustment data: 1. Paulson estimates that uncollectible accounts receivable at year-end are $4,000. 2. The note receivable is a one-year, 8% note dated April 1, 2012. No interest has been recorded. 3. The balance in prepaid insurance represents payment of a $3,600, 6-month premium on September 1, 2012. 4. The building is being depreciated using the straight-line method over 30 years. The salvage value is $30,000. 5. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost. 6. The equipment purchased on December 2, 2012, is being depreciated using the straight-line method over 5 years, with a salvage value of $1,800. 7. The patent was acquired on January 1, 2012, and has a useful life of 9 years from that date. 8. Unpaid salaries at December 31, 2012, total $2,200. 9. Both the short-term and long-term notes payable are dated January 1, 2012, and carry a 10% interest rate. All interest is payable in the next 12 months. 10. Income tax expense was $15,000. It was unpaid at December 31. $ Paulson Corporation's unadjusted trial balance at December 1, 2012, is presented 1. Debit Credit Cash $ 22,000 Accounts Receivable 36,800 Notes Receivable 10,000 Interest Receivable -0- Inventory H 36,200 Prepaid Insurance 3,600 Land 20,000 D Buildings 150,000 Equipment 60,000 Patent Fatem 9,000 Allowance for Doubtful Accounts 500 Accumulated Depreciation-Buildings Accum 50,000 24,000 Accumulated Depreciation Equipment Accounts Payable 27,300 Salaries and Wages Payable Notes Payable (due April 30, 2013) -0- v 11,000 Interest Payable -0- Notes Payable (due in 2018) 35,000 Common Stock 50,000 63,600 Retained Earnings Dividends 12,000 Sales Revenue 900,000 Interest Revenue -0- Gain on Disposal of Plant Assets -0- Red DeLa Bad Debts Expense -0- A Cost of Goods Sold Dauk 630,000 Depreciation Expense -0- Insurance Expense -0- Interest Expense -0- Other Operating Expenses 61,800 Amortization Expense -0- Salaries and Wages Expense 110,000 Total $1,161,400 $1,161,400 The following transactions occurred during December. Dec. 2 Paulson purchased equipment for $16,000, plus sales taxes of $800 (all paid in cash). 2 Paulson sold for $3,500 equipment which originally cost $5,000. Accumulated depreciation on this equipment at January 1, 2012, was $1,800; 2012 depreciation prior to the sale of equipment was $450. 15 Paulson sold for $5,000 on account inventory that cost $3,500. 23 Salaries and wages of $6,600 were paid. Adjustment data: 1. Paulson estimates that uncollectible accounts receivable at year-end are $4,000. 2. The note receivable is a one-year, 8% note dated April 1, 2012. No interest has been recorded. 3. The balance in prepaid insurance represents payment of a $3,600, 6-month premium on September 1, 2012. 4. The building is being depreciated using the straight-line method over 30 years. The salvage value is $30,000. 5. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost. 6. The equipment purchased on December 2, 2012, is being depreciated using the straight-line method over 5 years, with a salvage value of $1,800. 7. The patent was acquired on January 1, 2012, and has a useful life of 9 years from that date. 8. Unpaid salaries at December 31, 2012, total $2,200. 9. Both the short-term and long-term notes payable are dated January 1, 2012, and carry a 10% interest rate. All interest is payable in the next 12 months. 10. Income tax expense was $15,000. It was unpaid at December 31. $