The comparative balance sheets of Kingbird Corporation at the beginning and end of the year 2020 appear below. Inc./Dec. KINGBIRD CORPORATION BALANCE SHEETS Dec. 31, 2020 Jan 1, 2020 Assets Cash $21,060 $14,970 Accounts receivable 107,060 89.970 Equipment 40,060 23,970 Less: Accumulated Depreciation-Equipment (17,000) (11,000) Total $ 151,180 $117.910 Liabilities and Stockholders' Equity Accounts payable $21,060 $16.970 Common stock 101,060 81,970 Retained earnings 29,060 18,970 Total $151,180 $117.910 $6,090 Inc. 17,090 Inc. 16,090 Inc. 6,000 Inc. 4,090 Inc. 19,090 Inc. 10,090 Inc. Net income of $45,060 was reported, and dividends of $34,970 were paid in 2020. New equipment was purchased and none was sold. Prepare a statement of cash flows for the year 2020. (Show amounts that decrease cash flow with either a sig KINGBIRD CORPORATION Statement of Cash Flows For the Year Ended December 31, 2020 Cash Flows from Operating Activities Net Income 45060 Adjustment to reconcile net income to Net Cash Provided by Operating Activities Increase in Accounts Receivable - 17090 Depreciation 6000 Increase in Accounts Payable 4090 -7000 Net Cash Provided by Operating Activities 38060 Cash Flows from Investing Activities Purchase of Equipment -16090 Cash Flows from Financing Activities Issuance of Stock 19090 Payment of Dividends V -34970 Net Decrease in Cash - 15880 Cash at Beginning of Year 14970 Cash at End of Year 21060 Net Increase in Cash 6090 e Textbook and Media Compute the current ratio (current assets + current liabilities) as of January 1, 2020, and December 31, 2020. (Round ratios to 1 decimal place., December 31, 2020 January 1, 2020 Current ratio 7.2 6.9 Compute free cash flow for the year 2020. (Show amounts that decrease cash flow with either a-signes -15,000 or in parenthesis eg. (15,000).) Free Cash Flow $ -44970 e Textbook and Media x Your answer is incorrect. In light of the analysis in (part b), comment on Kingbird's liquidity and financial flexibility. Kingbird company has bad liquidity and bad financial flexibility