Compute the company's cash flow on total assets ratio for year 2

10) Use the following financial statements and additional information to (1) prepare a statement of cash flows for the year ended December 31, 20X2 using the indirect method, (2) prepare only the cash flows from operating activities section of the statement of cash flows using the direct method and (3) compute the company's cash flow on total assets ratio for 20x2 Derby Company Balance Sheets At December 31 20x2 20x1 Assets Cash Accounts receivable net Merchandise inventory Prepaid expenses Equipment Accumulated depreciation Equipment Total assets S 85.600 $ 65,200 72.850 $6.750 157,250 146850 16 080 12.680 280.600 1245.600 (80.600) (97.600) SARASO S27180 Liabilities Accounts payable Income taxes payable Notes payable long term Total liabilities Equity $ 52.850MS45,450 115.240 12240 59200 1920 S127290 136,890 Common stock Pad-in capital in excess of pat Retimned earning Total equiry Total liabilmes and equity 100.000 $3.000 141 $9.990 SSA 150,000 40.000 10.590 $1906 SHARE Dech ini Income Statement For Year Ended December 31, 20X2 Sales $488,000 Cost of goods sold $212,540 Depreciation expense 43,000 Other operating expenses 106.260 Interest expense 6.400 (368,200 Other gains (losses) Gain on sale of equipment 4.700 Income before taxes 124,500 Income taxes expense Net income 41,100 $ 83.400 Additional Information a. A $20.000 note payable is retired at its carrying value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $120,000 cash d. Received cash for the sale of equipment that had cost $85.000. yielding a gain of S4.700. e. Prepaid expenses relate to Other Expenses on the income statement. f. All purchases and sales of merchandise inventory are on credit