Waterways prepared the balance sheet and income statement for the irrigation installation division for 2020. Now the company also needs to prepare a statement of cash flows for the same division. The comparative balance sheets for Waterways Corporations Irrigation Installation Division for the years 2019 and 2020 and the income statement for the year 2020 are presented below. Additional information: 1. Waterways sold a company vehicle for $24,000. The vehicle had been used for 10 years. It cost $79,300 when purchased and had a 10-year life and a $6,000 salvage value. Straight-line depreciation was used. 2. Waterways purchased with cash new equipment costing $208,800. 3. Prepaid expenses increased by $33,500. All changes in accounts payable relate to inventory purchases.

(c) Determine free cash flow for the year 2020. (Enter negative amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

$749,800 541,800 $833,800 687,300 695,400 16,700 76,000 2,309,200 7,400 42,500 1,341,500 300,000 453,000 934,100 40,000 (484,100) 1,243,000 $3,552,200 300,000 453,000 804,600 40,000 (481,800) 1,115,800 $2,457,300 Cash Accounts receivable Work in process Inventory Prepaid expenses Total current assets Property, plant, and equipment Land Buildings Equipment Furnishings Accumulated depreciation Total property, plant, and equipment Total assets Liabilities and Stockholders' Equity Current liabilities Accounts payable Income taxes payable Wages payable Interest payable Other current liabilities Revolving bank loan payable Total current liabilities Long-term liabilities Note payable Total liabilities Stockholders' equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $127,200 80,700 2,000 $155,700 100,900 4,500 1,200 14,400 15,200 291,900 15,300 225,200 141,000 432,900 225,200 1,250,000 1,869,300 3,119,300 $3,552,200 1,250,000 982,100 2,232,100 $2,457,300 WATERWAYS CORPORATION-INSTALLATION DIVISION Income Statement For the Year Ending December 31, 2020 Sales $5,554,929 Less: Cost of goods sold 3,157,800 Gross profit 2,397,129 Operating expenses Advertising $50,300 Insurance 398,500 Salaries and wages 590,100 Depreciation 75,600 Other operating expenses 21,200 Total operating expenses 1,135,700 Income from operations 1,261,429 Other income Gain on sale of equipment 18,000 Other expenses Interest expense (12,000) Net other income and expenses 6,000 Income before income tax 1,267,429 Income tax expense 380,229 Net income $887,200 (a) Prepare a statement of cash flows using the indirect method for the year 2020. (Show am (15 no Statement of Cash Flows-Indirect Method $ Adjustments to reconcile net income to $ $ (c) Determine free cash flow for the year 2020. (Enter negative amount using either a negative sign preceding t Free cash flow $ Click if you would like to Show Work for this question: Open Show Work