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5. Obermeyer Corporation issued the following statement of cash flows for 2017. Obermeyer Corporation Statement of Cash Flows Indirect Method For the Year Ended
5. Obermeyer Corporation issued the following statement of cash flows for 2017. Obermeyer Corporation Statement of Cash Flows Indirect Method For the Year Ended December 31, 2017 Sensitivity Cash flows from operating activities Net income Adjustments to reconcile net income to net cash Provided by operating activities: $59,000 Depreciation expense $9,100 Loss on disposal of equipment 9,500 Increase in inventory (5,000) Decrease in accounts receivable 3,300 Decrease in accounts payable (2,200) 14.700 Net cash provided by operating activities 73,700 Cash flows from investing activities Sale of investments 3,100 Purchase of equipment (27.000) Net cash used by investing activities (23,900) Cash flows from financing activities Issuance of stock 20,000 Payment on long-term note payable (10,000) Payment for dividends (15.000) Net cash used by financing activities (5.000) Net increase in cash 44,800 Cash at beginning of year 13.000 Cash at end of year $27.800 a) Compute free cash flow for Obermeyer Corporation. b) Explain why free cash flow often provides better information than "Net cash provided by operating activities
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