Mary Walker, president of Rusco Company, considers $$35,000$ to be the minimum cash balance for operating purposes. As can be seen from the following statements, only $$30,000$ in cash was available at the end of this year. Because the company reported a large net income for the year, and also issued both bonds and common stock, the sharp decline in cash is puzzling to Ms$.$ Walker.

The following additional information is available for this year.

a$.$ The company paid a cash dividend.

b$.$ Equipment costing $$120,000$ with accumulated depreciation of $$55,000$ was sold for $$56,000.$

c$.$ Long$-$term investments costing $$60,000$ were sold for $$87,500.$

d$.$ The company did not retire any bonds payable or repurchase any of its common stock.

Required:

For this year:

Determine the net cash provided by $($used in$)$ operating activities using the indirect method.

Prepare a statement of cash flows.

Compute free cash flow.