3-2A. (Measuring Cash Flows) Given the information that follows, compute the free cash flows and financing cash flows for the J.B. Chavez Corporation for the year ended December 31, 2008. J.B. Chavez Corporation, Balance Sheet at 12/31/07 and 12/31/08 ($000) Assets 12/31/07 12/31/08 Cash $225 $175 Accounts receivable 450 430 Inventory 575 625 Current assets $1250 $1230 Plant and equipment $2200 $2500 Less: Accumulated depreciation (1000) (1200) Net plant and equipment $1200 $1300 Total assets $2450 $2530 Liabilities and Owners Equity 12/31/07 12/31/08 Accounts payable $250 $115 Notes payable-current (9%) 0 115 Current liabilities $250 $230 Bonds $600 $600 Owners equity Common stock $300 $300 Paid-in capital 600 600 Retained earnings 700 800 Total owners equity $1600 $1700 Total liabilities and owners equity $2450 $2530 J.B. Chavez Corporation, Income Statement for the year ending 12/31/07 and 12/31/08 2007 2008 Sales $1250 $1450 Cost of goods sold 700 875 Gross profit $550 $575 Operating expenses 30 45 Depreciation 220 200 Net operating income $300 $330 Interest expense 50 60 Net income before taxes $250 $270 Taxes (40%) 100 108 Net income