Here is a comparative balance sheet for Puffed Up Company:

Additional information:
1. Net income for 2008 was $98,000. Land was sold at cost.
2. Cash dividends of $40,000 were declared and paid.
3. Bonds payable amounting to $50,000 were redeemed for cash $50,000.
4. Common stock was issued for $42,000 cash.
5. Sales for 2008 were $978,000.

Instructions
(a) Prepare a statement of cash flows for 2008 using the indirect method.
(b) Compute these cash-basis ratios:
(1) Current cash debt coverage.
(2) Cash debtcoverage.

Puffed Up Company Comparative Balance Sheet December 31 Assets 2008 2007 Cash Accounts receivable Inventories Land Equipment Accumulated depreciation 63,000 85,000 170,000 75,000 270,000 (66,000) $597,000 s 22,000 76,000 189,000 100,000 200,000 (32,000) $555,000 Total Liabilities and Stockholders' Equity Accounts payable Bonds payable Common stock (S1 par) Retained earnings S 39,000 150,000 216,000 192,000 $597,000 47,000 200,000 174,000 134,000 $555,000 Total