Rees Corporation's comparative balance sheets are presented below.

Additional information:
1. Net income was $18,300. Dividends declared and paid were $16,400.
2. Equipment which cost $10,000 and had accumulated depreciation of $1,200 was sold for $3,300.
3. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation.

Instructions
(a) Prepare a statement of cash flows for 2011 using the indirect method.
(b) Compute free cash flow.

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REES CORPORATION Comparative Balance Sheets December 31 2011 2010 Cash Accounts receivable Investments Equipment Accumulated depreciation 15,200 17,700 22,300 16,000 70,000 14,000 10,000) $106,400 16,000 25,200 20,000 60,000 Total Accounts payable Bonds payable Common stock Retained earnings $14,600 11,100 30,000 45,000 29,900 $106,400 $116,000 10,000 50,000 31,800 Total