Presented here are the financial statements of Ivanhoe Company. Ivanhoe Company Comparative Balance Sheets December 31 2025 2024 Assets Cash $73,500 $42,000 Accounts receivable 42,000 29,400 Inventory 58,800 42,000 Property, plant, and equipment 126,000 163,800 Accumulated depreciation (67,200) (50,400) Total $233,100 $226,800 Liabilities and Stockholders' Equity Liabilities and Stockholders' Equity Accounts payable $39,900 $31,500 Income taxes payable 14,700 16,800 Bonds payable 35,700 69,300 Common stock 37,800 29,400 Retained earnings 105,000 79,800 Total $233,100 $226,800 Ivanhoe Company Income Statement For the Year Ended December 31, 2025 Sales revenue Cost of goods sold Gross profit $508,200 367,500 140,700 Selling expenses $37,800 Administrative expenses 12,600 50,400 Income from operations 90,300 Interest expense 6,300 Income before income taxes 84,000 Income tax expense 16,800 Net income $67.200 Additional data: 1. Depreciation expense was $36,750. 2. Dividends declared and paid were $42.000. 3. 4. During the year, equipment was sold for $17,850 cash. This equipment originally cost $37,800 and had accumulated depreciation of $19,950 at the time of sale. Bonds were redeemed at their carrying value 4. Bonds were redeemed at their carrying value. 5. Common stock was issued at par for cash. (a) Your answer is partially correct. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a-sign eg.-15,000 or in parenthesis e.g. (15,000).) IVANHOE COMPANY Statement of Cash Flows-Indirect Method For the Year Ended December 31, 2025 Cash Flows from Operating Activities For the Year Ended December 31, 2025 Cash Flows from Operating Activities Net Income Adjustments to reconcile net income to Net Cash Provided by Operating Activities Increase in Accounts Receivable (12600) Increase in Inventory (16800) Increase in Accounts Payable 8400 Decrease in Income Taxes Payable (2100) Depreciation Expense 36750 67200 13650 Net Cash Provided by Operating Activities 80850 Purchase of Equioment Net Cash Provided by Investing Activities Cash Flows from Financing Activities Redemption of Bonds Payment of Dividends Payment of Dividends Net Cash Used by Financing Activities Net Increase in Cash Cash at Beginning of Period Cash at End of Period eTextbook and Media Save for Later Attempts: 8 of 15 used Submit Answer (b) Compute free cash flow. (Show amounts that decrease free cash flow with either a-sign eg-15,000 or in parenthesis eg. (15,000)) Free cash flow eTextbook and Media Save for Later Attempts: 0 of 15 used Submit