The following income statement and balance sheet information are available for two firms, Firm A and Firm B.

(a) Calculate the amount of dividends Firm A and Firm B paid using the information given.

(b) Prepare statement of cash flows for each firm using the indirect method.

(c) Analyze the difference in the two firms,

Income Statement for Year Ended Decemeber 31,2015

Firm A Firm B

Sales 1,000,000 1,000,000

Cost of Goods Sold 700,000 700,000

Gross Profit 300,000 300,000

Other Expenses

Selling and Admin. 120,000 115,000

Depreciation 10,000 30,000

Interest Expense 20,000 5,000

Earnings before taxes 150,000 150,000

Income tax expense 75,000 75,000

Net income 75,000 75,000

Changes in Balance Sheet Accounts December 31,2014, to Decemebr 31,2015

Firm A Firm B

Cash and Cash Equivalents 0 +10,000

Accounts receivable +40,000 +5,000

Inventory +40,000 -10,000

Property, plant, and equipment +20,000 +70,000

Less accumulated depreciation (+10,000) (+30,000)

Total Assets +90,000 +45,000

Accounts payable -20,000 -5,000

Notes payable +17,000 +2,000

Long-term debt +20,000 -10,000

Deferred taxes +3,000 +18,000

Retained earnings +70,000 +40,000

Total Liabilities and Equity +90,000 +45,000

Please answer part C) as I have already figured out the first two portions. I'm just struggling with how to analyze the cash flow statement.