Presented below are the financial statements of Nosker Company.

NOSKER COMPANY
Income Statement
For the Year Ended December 31, 2014
Sales revenue........................$242,000
Cost of goods sold....................175,000
Gross profit.............................67,000
Operating expenses....................24,000
Income from operations............43,000
Interest expense.......................3,000
Income before income taxes......40,000
Income tax expense..................8,000
Net income........................$ 32,000
Additional data:
1. Dividends declared and paid were $20,000.
2. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had a book value of $8,500 at the time of sale.
3. All depreciation expense, $14,500, is in the operating expenses.
4. All sales and purchases are on account.
Instructions
1. Prepare a statement of cash flows using the indirect method.
Cash from operations $31,500
2. Compute free cash flow.
Data for Nosker Company are presented in P17-7A. Further analysis reveals the following.
1. Accounts payable pertain to merchandise suppliers.
2. All operating expenses except for depreciation were paid in cash.
Instructions
1. Prepare a statement of cash flows for Nosker Company using the direct method.
Cash from operations $31,500
2. Compute free cash flow.

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NOSKER COMPANY Comparative Balance Sheets December 31 Assets 2014 2013 Cash $ 38,000 $20,000 Accounts receivable 30,000 14,000 Inventory 27,000 20,000 78,000 (24,000) $108,000 Equipment 60,000 Accumulated depreciation-equipment (29,000) Total $126,000 Liabilities and Stockholders' Equity $24,000 Accounts payable Income taxes payable Bonds payable S 15,000 7,000 8,000 27,000 33.000 Common stock 18,000 14,000 38,000 $108,000 Retained earnings 50,000 Total $126,000