Comparative statement of financial positions for the Burgundy Corporation are presented below:
Additional information:
Additional information:
1. Net loss for 2020 is $20,000. Net sales for 2020 are $250,000.
2. Cash dividends of $4,000 were declared and paid during the year.
3. Land was sold for cash at a loss of $10,000. This was the only land transaction during the year.
4. Equipment with a cost of $15,000 and accumulated depreciation of $10,000 was sold for $5,000 cash.
5. $12,000 of debentures were retired during the year at their carrying amount.
6. Equipment was acquired for ordinary shares. The fair market value of the shares at the time of the exchange was $25,000.
Required:
1. Prepare a statement of cash flows for the year ended 2020.
2. Compute the following cash based ratios:
a. current cash debt coverage
b. cash return on sales ratio
c. cash debt coverage ratio.

Question

Comparative statement of financial positions for the Burgundy Corporation are presented below:
Additional information:
  Additional information:
1. Net loss for 2020 is $20,000. Net sales for 2020 are $250,000.
2. Cash dividends of $4,000 were declared and paid during the year.
3. Land was sold for cash at a loss of $10,000. This was the only land transaction during the year.
4. Equipment with a cost of $15,000 and accumulated depreciation of $10,000 was sold for $5,000 cash.
5. $12,000 of debentures were retired during the year at their carrying amount.
6. Equipment was acquired for ordinary shares. The fair market value of the shares at the time of the exchange was $25,000.
Required:
1. Prepare a statement of cash flows for the year ended 2020.
2. Compute the following cash based ratios:
 a. current cash debt coverage
 b. cash return on sales ratio
 c. cash debt coverage ratio.

Quizplus · Accepted Answer

The Answer of Comparative statement of financial positions for the Burgundy Corporation are presented below:
Additional information:
  Additional information:
1. Net loss for 2020 is $20,000. Net sales for 2020 are $250,000.
2. Cash dividends of $4,000 were declared and paid during the year.
3. Land was sold for cash at a loss of $10,000. This was the only land transaction during the year.
4. Equipment with a cost of $15,000 and accumulated depreciation of $10,000 was sold for $5,000 cash.
5. $12,000 of debentures were retired during the year at their carrying amount.
6. Equipment was acquired for ordinary shares. The fair market value of the shares at the time of the exchange was $25,000.
Required:
1. Prepare a statement of cash flows for the year ended 2020.
2. Compute the following cash based ratios:
 a. current cash debt coverage
 b. cash return on sales ratio
 c. cash debt coverage ratio.

Comparative Statement of Financial Positions for the Burgundy Corporation Are