2-8B. (AnalyzingJree cash jl(Y/J)s) Following you will find our computation of the free cash flows for Hilary's Ice Cream. Interpret the information in terms of where cash came from and where it was used.

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Hilary's Free Cash Flows ($ in Thousands) CASH FLOWS FROM AN ASSET PERSPECTIVE After-tax cash flows from operations: Operating income $13,129 Depreciation 9,202 Earnings before interest, tax, depreciation $22,331 Tax expense $ 1,823 Less change in income tax payable 1,215 Less change in deferred taxes Cash taxes After-tax cash flows from operations Other income (losses) (4,174) $ 4,782 17,549 (6,596) $10,953 Change in net operating working capital: Change in cash $ (638) Change in accounts receivable Change in inventories 7,495 847 Change in other current assets (2,666) Change in current assets $ 5,038 Change in accounts payable $ 5,456 Change in accrued expenses 517 Change in noninterest-bearing current debt $ 5,973 Change in net operating working capital $ (935) Change in fixed assets and other assets: Purchase of fixed assets $ (757) Change in investments Change in other assets Net cash used for investments Asset free cash flows CASH FLOWS FROM A FINANCING PERSPECTIVE Interest expense Less decrease in long-term debt (103) 3,060 $ 2,200 $ 9,688 Plus increase in short-term debt Less dividends $(1,634) (3,822) 361 Less decrease in common stock Financing free cash flows (4,593) $(9,688)