E5.16 (L03) (Preparation of a Statement of Cash Flows) A comparative balance sheet for Shabbona Corporation is presented as follows. Assets Cash Accounts receivable Inventory Land Equipment Accumulated depreciation-equipment Total Liabilities and Stockholders' Equity Accounts payable Bonds payable Common stock ($1 par) Retained earnings Total December 31 2020 2019 $ 73,000 $ 22,000 82,000 66,000 180,000 189,000 71,000 110,000 260,000 200,000 (69.000) (42,000) $597,000 $545,000 $ 34,000 150,000 214,000 199,000 $597,000 $ 47,000 200,000 164,000 134,000 $545,000 Additional information: 1. Net income for 2020 was $125,000. No gains or losses were recorded in 2020. 2. Cash dividends of $60,000 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 2020 for Shabbona Corporation. b. Determine Shabbona Corporation's current cash debt coverage, cash debt coverage, and free cash flow. Comment on its liquidity and financial flexibility