Presented below is a condensed version of the comparative balance sheets for Garcia Corporation for the last two years at December 31.

Additional information:
Investments were sold at a loss (not extraordinary) of $25,000; no equipment was sold; cash dividends paid were $75,000; and net income was $400,000.

Instructions
(a) Prepare a statement of cash flows for 2012 for Garcia Corporation.
(b) Determine Garcia Corporation€™s free cashflow.

2014 2013 $442,500 450,000 130,000 745,000 $195,000 462,500 185,000 600,000 Accounts receivable Investments Equipment Less: Accumulated depreciation (265,000 Current liabilities Capital stock Retained earnings 222,500) 335,000 400.000 767,500 377,500 400,000 442,500