Assets Directions: A) Using the information below and the template on the next tab, prepare a statement of cash flows (indirect method). B) Also using the template on the next tab, compute free cash flow. Respond to the anlaysis question at the bottom of the template using the information prepared in A) and B). Helpful tig: If you need a refresher on how to complete this project, watch M2 Part We Really Love Cash, Co. We Really Love Cash, Co. Comparative Balance Sheet Income Statement December 31 For the Year ended December 31, 2020 2020 2019 Sales revenue $127,900 Cost of goods sold 69,800 Cash $6,200 $4,300 Gross profit 58,100 Accounts Receivable 5,200 5,500 Operating expenses 46,900 Inventory 30,000 34,200 Income from before gain and taxes 11,200 Property, plant & equipment, net 211,500 215,300 Gain on sale of equipment 900 Total Assets $252,900 $259,300 income tax expense Net income $11,300 Liabilities and Stockholders' Equity Accounts payable $1,700 $5,900 Accrued expenses 2,000 2,200 Taxes payable 2,500 2,600 Bonds payable 60,000 50,000 Total liabilities 66,200 60,700 Common stock 125,000 125,000 Retained earnings 61,700 73,600 Total Stockholders' Equity 186,700 198,600 800 2020 Page of 2 0 ZOOM + December 31 For the Year ended December 31, 2020 2019 Sales revenue $127,900 Assets Cost of goods sold 69,800 Cash $6,200 $4,300 Gross profit 58,100 Accounts Receivable 5,200 5,500 Operating expenses 46,900 Inventory 30,000 34,200 Income from before gain and taxes 11,200 Property, plant & equipment, net 211,500 215,300 Gain on sale of equipment 900 Total Assets $252,900 $259,300 Income tax expense 800 Net income $11,300 Liabilities and Stockholders' Equity Accounts payable $1,700 $5,900 Accrued expenses 2,200 Taxes payable 2,500 2,600 Bonds payable 60,000 50,000 Total liabilities 66,200 60,700 Common stock 125,000 125,000 Retained earnings 61,700 73,600 Total Stockholders' Equity 186,700 198,600 Total Liabilities and Stockholders' Equity $252,900 $259,300 Additional data: 1. Depreciation expense of $1,900 is included in the Operating Expenses on the income Statement. 2. Equipment with an original cost of $35,000 was sold for $20,300. The gain on sale was $900. 3. On June 1, 2020, the company purchased new equipment for cash at a cost of $17,500. 4. The company paid $23,200 in cash dividends for the year. 2,000 2 We Really Lave Gash, C. Soment of Cash Flow For the year ended December 31, 2020 Cash Bows from opening Nelcome In order to get fall points for this project in ble should securely flect financial content worth I point each Callinen on the templite should the formules worth 1 pour each sin yellow show the proper format and onder of the statement with painteach 2 Canonge provides a corect response to the analytique $11,00 6 10 11 13 16 19 30 11 35 20 21 20 20 EX 29 B) Free Cash Flow: 30 31 32 33 34 35 C) 36 37 38 39 40 41 42 You are in top management at We Really Love Cash, Co. Others in top management want to give MORE in cash dividends to investors. Based on the results of the Free Cash Flow calculation, do you agree that the company has the cash available to increase dividends to the investors right away? 44 45