Data for the Sean Seymor Company are presented in P14-5A. Further analysis reveals the following:

1. Accounts payable pertains to merchandise creditors.

2. All operating expenses except for depreciation are paid in cash.

\section*{Instructions}

(a) Prepare a statement of cash flows using the direct method.

(b) Compute the following cash basis ratios:

(1) Current cash debt coverage ratio.

(2) Cash return on sales ratio.

(3) Cash debt coverage ratio.