Presented here are the financial statements of Pronghorn Company. Pronghorn Company Comparative Balance Sheets December 31 2025 2024 Assets Cash $112,000 $ 64,000 Accounts receivable 64,000 44,800 Inventory 89,600 64,000 Property, plant, and equipment 192,000 249,600 Accumulated depreciation (102,400) (76,800) Total $355,200 $345,600 Liabilities and Stockholders' Equity Accounts payable Income taxes payable Bonds payable Common stock $ 60,800 $ 48,000 22,400 25,600 54,400 105,600 57,600 44,800 Liabilities and Stockholders' Equity Accounts payable $ 60,800 $ 48,000 Income taxes payable 22,400 25,600 Bonds payable 54,400 105,600 Common stock 57,600 44,800 Retained earnings 160,000 121,600 Total $355,200 $345,600 Pronghorn Company Income Statement For the Year Ended December 31, 2025 Sales revenue $774,400 Cost of goods sold 560,000 Gross profit 214,400 Selling expenses $57,600 Administrative expenses 19,200 76,800 Income from operations 137,600 Interest expense 9,600 Income before income taxes 128,000 Income tax expense 25,600 Net income $ 102,400 Additional data: 1. Depreciation expense was $56,000. 2. Dividends declared and paid were $64,000. 3. During the year, equipment was sold for $27,200 cash. This equipment originally cost $57,600 and had accumulated depreciation of $30,400 at the time of sale. 4. Bonds were redeemed at their carrying value. 5. Common stock was issued at par for cash. (a) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) PRONGHORN COMPANY Statement of Cash Flows - Indirect Method Adjustments to reconcile net income to $ $ > +A Compute free cash flow. (Show amounts that decrease free cash flow with either a -sign e.g. -15,000 or in parenthesis e.g. (15,000).) Free cash flow +A $