The cash flow data of Calendar Company for the year ended December 31, 2004 are as follows:
Cash payment of dividends $ 80,000
Purchase of land $ 18,000
Cash payments for interest $ 20,000
Cash payments for salaries $ 90,000
Sale of equipment $ 76,000
Retirement of common stock $ 50,000
Purchase of equipment $ 60,000
Cash payment to suppliers $170,000
Cash collection from customers $500,000
Cash at beginning of year $100,000
o Prepare a statement of cash flows for Calendar Company using the direct method in accordance with SFAS 95.
o Discuss, from an analyst's viewpoint, the purpose of classifying cash flows into the categories required by SFAS 95.