Problem S. Presented below are comparative Balance sheets of International Company. INTERNATIONAL COMPANY Comparative Balance Sheet December 31 2017 Assets Cash $73,000 Accounts Receivable 85,000 Inventory 180,000 Land 75,000 Equipment 250,000 Accumulated depreciation-equipment (66,000) Total $597,000 Liabilities and Stockholders' Equity Accounts payable $34,000 Bands (long-term) payable 150,000 Common stock 214,000 Retained earnings 199,000 Total $597,000 Additional data: 1. Net income for 2017 was $135,000 2. Depreciation expense in 2017 was $24,000 3. New equipment was purchased at $74,000 for cash Instructions: a) Prepare cash flows from operating activities using the indirect method. (1 point) b) Compute free cash flow. (0.5 points) INTERNATIONAL COMPANY Statement of Cash Flows For the Year Ended December 31, 2017 Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities Depreciation expense Increase in accounts receivable Increase in inventory Increase in accounts payable Net cash provided by operating activities Free cash flow= 2016 $22,000 76,000 189,000 100,000 200,000 (42,000) $545,000 $47,000 200,000 164,000 134,000 $545,000