The following is the balance sheet for Crown-well Inc. for the period ending December 2011:

Crown-well Inc.

Balance Sheet (2011)

Cash

$ 24,000

Current Liabilities

$ 30,000

Other current assets

51,000

Long-Term Notes payable

33,000

Total current assets

75,000

Bonds

40,000

Investments

40,000

Common Stock

150,000

Fixed Assets(Net)

125,000

Retained Earnings

49,000

Land

62,000

$ 302,000

$ 302,000

The following transactions occurred during 2012:

i. $20,000, sale on some of its investments

ii. $12,000, additional land for expansion

iii. $10,000, bonds payment

iv. $20,000, issuance of common stock

v. $5,000, dividend payment to stockholders

vi. $42,000, Net Income for 2012

vii. $18,000, depreciation

viii. $10,050, taxes

ix. $10,000, Interest expense

x. $18,000, purchase of second piece of land, using $12,000 in bonds and $6,000 in long-term notes payable.

Required:

a) Prepare a balance Sheet for Crown-well Inc. as at period ending 2012. (5 POINTS)

b) Compute the firms free cash flows for 2012. (Hint: In computing FCF, please consider changes in investments and changes in Land as separate items from the Net Fixed Asset in the balance sheet)