Presented below are the financial statements of Tomas Company.

Additional data:
1. Dividends of $33,000 were declared and paid.
2. During the year equipment was sold for $10,000 cash. This equipment cost $13,000 originally and had a book value of $10,000 at the time of sale.
3. All depreciation expense, $6,000, is in the selling expense category.
4. All sales and purchases are on account.
5. Additional equipment was purchased for $5,000 cash.

Instructions
(a) Prepare a statement of cash flows using the indirect method.
(b) Compute free cashflow.

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TOMAS COMPANY Comparative Balance Sheets December 31 Assets Cash Accounts receivable Merchandise inventory Property, plant, and equipment Less: Accumulated depreciation 2011 28,000 23,000 41,000 2010 33,000 14,000 25,000 70,000 78,000 43,000 24,000 54,000 Total $135,000 $126,000 Liabilities and Stockholders Equit Accounts payable Income taxes payable Bonds payable Common stock Retained earnings 31,000 26,000 20,000 25,000 33,000 $135,000 $ 43,000 20,000 10,000 25,000 28,000 Total 126,000 TOMAS COMPANY Income Statement For the Year Ended December 31, 2011 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Income from operations Interest expense Income before income taxes Income tax expense Net income $286,000 194,000 92,000 $28,000 9,000 37,000 55,000 7,000 48,000 10,000 38,000