P17-7A Presented below are the financial statements of Weller Company. WELLER COMPANY Comparative Balance Sheets December 31 Assets 2012 2011 Cash $ 35,000 $ 20,000 Accounts receivable 33,000 14,000 Merchandise inventory 27,000 20,000 Property, Plant and Equipment 60,000 78,000 Accumulated depreciation (29,000) (24,000) Total $126,000 $108,000 Liabilities and Stockholders' Equity Accounts payable $ 29,000 $ 15,000 Income taxes payable 7,000 8,000 Bonds payable 27,000 33,000 Common stock 18,000 14,000 Retained earnings 45,000 38,000 Total $126,000 $108,000 WELLER COMPANY Income Statement For the Year Ended December 31, 2012 Sales $242,000 Cost of goods sold 175,000 Gross profit 67,000 Operating expenses 24,000 Income from operations 43,000 Interest expense 3,000 Income before income taxes 40,000 Income tax expense 8,000 Net income $ 32,000 Additional data: Dividends declared and paid were $25,000. 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. All depreciation expense, $14,500, is in the selling expense category. All sales and purchases are on account. Prepare a statement of cash flows using the indirect method. (List multiple entries with a positive cash flow first and then the negative cash flow. List amounts from largest to smallest e.g. 10, 5, 3, 2. If amount decreases cash flow, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) WELLER COMPANY Statement of Cash Flows For the Year Ended December 31, 2012 Cash flows from operating activities $ Adjustments to reconcile net income to net cash provided by operating activities $ Net cash by operating activities Cash flows from investing activities Cash flows from financing activities Net cash by financing activities Net in cash Cash at beginning of period Cash at end of period $ Compute free cash flow. $