10.2 A

P13.7A (LO 2, 3), AN The following are the financial statements of Nosker Compony thed, and cempute free Nosker Company Comparative Balance Sheets December 31 2019 Assets Cash Accounts receivable 2020 38,000 20,000 30,000 27,000 60,000 (29,000) 14,000 20,000 78,000 (24,000) Equipment Accumulated depreciation-equipment Total $108,000 Liabilities and Stockholders' Equity s 15,000 8,000 33,000 14,000 S 24,000 7,000 Accounts payable Income taxes payable Bonds payable Common stock Retained earnings 50,000 $126,000 Total $108,000 Nosker Company Income Statement For the Year Ended December 31, 2020 Sales revenue Cost of goods sold Gross profit Operating expenses Income from operations Interest expense Income before income taxes Income tax expense Net income $242,000 175,000 67,000 24,000 43,000 3,000 40,000 8,000 S 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. nstructions a. Prepare a statement of cash flows using the indirect method. b. Compute free cash flow a. Cash from operating activities $31,500