Use the information in E5-18 for Sensify Corporation.
In E5-18
The comparative statement of financial position of Sensify Corporation as at December 31, 2017, follows:

Net income of $37,000 was reported and dividends of $13,000 were declared and paid in 2017. New equipment was purchased, and equipment with a carrying value of $5,000 (cost of $12,000 and accumulated depreciation of $7,000) was sold for $8,000.
Instructions
(a) Calculate the current ratio and debt to total assets ratio as at December 31, 2016 and 2017. Calculate the free cash flow for December 31, 2017.
(b) Based on the analysis in (a), comment on the company's liquidity and financial flexibility.

SENSIFY CORPORATION Statement of Financial Position December 31 December 31 Assets Cash Accounts receivable Equipment Less: Accumulated depreciation 2017 2016 $53,000 13,000 88,000 22,000 (11,000) $161,000 $112,000 91,000 27,000 (10,000) Total Liabilities and Shareholders' Equity Accounts payable Common shares Retained earnings $ 20,000 15,000 80,000 17,000 $161,000 $112,000 100,000 41,000 Total