Question: A comparative balance sheet for Riverbed Corporation is presented as follows. December 31 Assets 2020 2019 Cash $ 72,760 $ 22,000 Accounts receivable 83,040 67,280
A comparative balance sheet for Riverbed Corporation is presented as follows.
| December 31 | ||||||
| Assets | 2020 | 2019 | ||||
| Cash | $ 72,760 | $ 22,000 | ||||
| Accounts receivable | 83,040 | 67,280 | ||||
| Inventory | 181,040 | 190,280 | ||||
| Land | 72,040 | 111,280 | ||||
| Equipment | 261,040 | 201,280 | ||||
| Accumulated Depreciation-Equipment | (70,040 | ) | (43,280 | ) | ||
| Total | $599,880 | $548,840 | ||||
| Liabilities and Stockholders' Equity | ||||||
| Accounts payable | $ 35,040 | $ 48,280 | ||||
| Bonds payable | 150,000 | 200,000 | ||||
| Common stock ($1 par) | 214,000 | 164,000 | ||||
| Retained earnings | 200,840 | 136,560 | ||||
| Total | $599,880 | $548,840 | ||||
Additional information:
| 1. | Net income for 2020 was $127,080. No gains or losses were recorded in 2020. | |
| 2. | Cash dividends of $62,800 were declared and paid. | |
| 3. | Bonds payable amounting to $50,000 were retired through issuance of common stock. |
Determine Riverbed Corporations current cash debt coverage, cash debt coverage, and free cash flow. (Round current cash debt coverage and cash debt coverage to 2 decimal places, e.g. 0.67.)
| Current cash debt coverage | :1 | ||
| Cash debt coverage | :1 | ||
| Free cash flow | $ |
Comment on its liquidity and financial flexibility.
| Riverbed has poor/excellent liquidity. Its financial flexibility is good/bad |
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