THE BUSINESS This practice set is designed in two parts. The first part provides a review of the financial statements of a corporation selling United States and Texas flags. Pete's Patriotic Flags, Inc., primary operation is the sale of flags. A financial analysis and Statement of Cash Flow will be required. In the second part, Pete's Patriotic Flags, Inc. will expand to include the manufacturing process of the flags. All cases of academic dishonesty will be reported to the Office of Student Life. PART ONE INSTRUCTIONS The financial information for the past two years (2021 and 2020) is provided. Using a spreadsheet application, such as Microsoft Excel, and the information from the previous years, provide the following: 1. Prepare a Statement of Cash Flows for the current year using the indirect method. Use the following template. 2. Using horizontal analysis, prepare a Comparative Balance Sheet. Copy the financial statements on Blackboard into an Excel spreadsheet and insert a column to add the percentages. 3. Using vertical analysis, prepare a Comparative Income Statement. Copy the financial statements on Blackboard into an Excel spreadsheet and insert a column to add the percentages. 4. Using the financial statements in the practice set (located on Blackboard), calculate the ratios below: (Use the following templates shown here in the practice set) a. Working Capital both years b. Current Ratio both years c. Quick ratio both years d. Accounts Receivable Turnover 2021 e. Number of Days Sales in Receivables 2021 (Company policy states 30 days in receivables) f. Inventory Turnover 2021 8. Number of Days Sales in Inventory 2021 (Company policy states 8 days to turn over inventory) h. Ratio of Liabilities to Stockholders' Equity 2021 1. Return on Total Assets 2021 Sve Return on Stockholders' Equity 2021 k. Earnings Per Share 2020 and 2021