The following is a listing of the accounts of Bob's Baubles, Inc. at Dec 31, 2002: Cash Accounts Receivable $35,000 10,000 Inventory (9 Baubles @ $5,000 each) 45,000 Prepaid Rent 2,000 Equipment 450,000 Accumulated Depreciation 150,000 Accounts Payable 15,000 Wages Payable 12,000 Taxes Payable 10,000 Common Stock (5,000 shares) 150,000 Retained Earnings 205,000 During 2003 the following transactions occurred: Jan 1 Jan 1 Jan 2 Jan 15 Feb 1 Mar 1 Mar 15 Paid 12/31/02 accounts payable balance. Borrowed $100,000. The money is to be repaid in five years. Interest on the loan is 10% and the interest is paid each December 31". Received 12/31/02 accounts receivable. Purchased 20 Baubles at $6,000 each. Paid 30% down and will pay the rest later. Sold 24 Baubles for $16,000 each with 40% down (cash) and the other 60% on account. Paid cash for wages of $36,000. Paid 2002 taxes. Received cash from customers who bought Baubles on Feb 1, $50,000. Paid $30,000 to creditors (see Jan 15). Paid rent, $8,000 (rent is $2,000 per month). May 1 July 1 July 1 July 1 Oct 1 Paid $9,000 advertising for 2003. Nov 1 Issued 1,000 shares of common stock for $ $30,000. Dec 31 Purchased a one-year insurance policy for $6,000. Paid utility bill for 2003, $12,000. Dec 31 Paid $40,000 for wages. Dec 31 Paid interest on loan The Company uses the FIFO inventory system At Dec 31, 2003, Bob owed $10,000 in wages which had not yet been paid. The equipment originally cost $450,000, had a ten year life and was expected to be worth $50,000 at the end. The tax rate is 30% and the 2003 taxes are to be paid in 2004. At December 31, 2003, the market price of the stock was $50 per share. 4. On the base of above data, you are required to prepare Cash flow statement using indirect method (10 points) 5. On the base of the above data, you are required to prepare: a) Balance sheet (6 points) b) Calculate the activity ratios and liquidity (4 points)