Question
The CF Industries Company has the following comparative balance sheets: CF Industries Company Comparative Balance Sheet Dec. 31, Dec. 31, 2018 2017 Assets Cash $
The CF Industries Company has the following comparative balance sheets:
CF Industries Company
Comparative Balance Sheet
Dec. 31, Dec. 31,
2018 2017
Assets
Cash $ 23,000 $10,000
Accounts receivable 18,000 14,000
Inventory 27,000 18,000
Prepaid expense 6,000 9,000
Land 0 18,000
Equipment 60,000 32,000
Accumulated depreciation--equipment (18,000) (14,000)
Total assets $116,000 $87,000
Liabilities and Stockholders' Equity
Accounts payable $ 15,000 $ 2,000
Income tax payable 2,000 5,000
Bonds payable 37,000 47,000
Common stock 40,000 23,000
Retained earnings 22,000 10,000
Total liabilities and stockholders' equity $116,000 $87,000
Additional information:
1. Cash dividends of $12,000 were declared and paid during the year.
2. Land which originally cost $18,000 was sold for $16,000.
3. Common stock was issued at par value for cash.
4. Net income for the year was $24,000.
INSTRUCTIONS
a. Prepare a statement of cash flows for the year ended December 31, 2018, using the indirect method.
b. Compute free cash flow for 2018.
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