Rodriquez Corporation€™s comparative balance sheets are presented below.

Additional information:
1. Net income was $18,300. Dividends declared and paid were $16,400.
2. Equipment which cost $10,000 and had accumulated depreciation of $1,200 was sold for $3,300.
3. No noncash investing and financing activities occurred during 2020.

Instructions
a. Prepare a statement of cash flows for 2020 using the indirect method.
b. Compute free cash flow.

Transcribed Image Text:

Rodriquez Corporation Comparative Balance Sheets December 31 2020 2019 $ 15,200 25,200 $ 17,700 Cash Accounts receivable 22,300 16,000 70,000 Investments 20,000 Equipment Accumulated depreciation-equipment 60,000 (14,000) (10,000) Total $106,400 $116,000 Accounts payable Bonds payable $ 11,100 $ 14,600 10,000 30,000 Common stock 50,000 45,000 Retained earnings 31,800 29,900 $106,400 $116,000 Total