Statement of Cash Flows

Preparing a Statement of Cash Flows (Indirect Method) Dair Company's income statement and comparative balance sheets follow. During Year 8 , the company sold for $12,750 cash old equipment that had cost $27,000 and had $14,250 accumulated depreciation. Also in Year 8 , new equipment worth $45,000 was acquired in exchange for $45,000 of bonds payable, and bonds payable of $90,000 were retired for cash at a loss. A \$19,500 cash dividend was declared and paid in Year 8. Any stock issuances were for cash. REQUIRED a. Compute the change in cash that occurred in Year 8 . b. Prepare a Year 8 statement of cash flows using the indirect method. c. Prepare separate schedules showing (1) cash paid for interest and for income taxes and (2) noncash investing and financing transactions. d. Compute its (1) operating cash flow to current liabilities ratio, (2) operating cash flow to capital expenditures ratio, and (3) free cash flow