Apex Company prepared the statement of cash flows for the current year that is shown below:

Required:

Compute Apex Company’s free cash flow for the current year.

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Арех Сompany Statement of Cash Flows-Indirect Method Operating activities: Net income Adjustments to convert net income to cash basis: $ 40,000 $ 22,000 (60,000) (25,000) 9,000 55,000 Depreciation charges Increase in accounts receivable Increase in inventory Decrease in prepaid expenses Increase in accounts payable Decrease in accrued liabilities (12,000) 5,000 Increase in deferred income taxes (6,000) 34,000 Net cash provided by operating activities Investing activities: Proceeds from the sale of equipment Loan to Thomas Company Additions to plant and equipment Net cash used for investing activities Financing activities: Increase in bonds payable Increase in common stock 14,000 (40,000) (110,000) (136,000) 90,000 40,000 (30,000) Cash dividends Net cash provided by financing activities Net decrease in cash Cash balance, beginning of year Cash balance, end of year 100,000 (2,000) 27,000 $ 25,000