Meera Ltd.’s comparative statements of financial position are presented below.

Additional information:
1. Net income was £22,590. Dividends declared and paid were £16,500.
2. All other changes in non-current account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for £5,000.
Instructions

a. Prepare a statement of cash flows for 2025 using the indirect method.

b. Compute free cash flow.
Prepare a statement of cash flows—indirect method.

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Meera Ltd. Comparative Statements of Financial Position December 31 2025 2024 Land 20,000 26,000 Buildings 70,000 70,000 Accumulated depreciation-buildings (15,000) (10,000) Accounts receivable 20,800 23,400 Cash 17,660 10,700 Total 113,460 120,100 Share capital-ordinary Retained earnings Accounts payable Total 75,000 72,000 26,090 20,000 12,370 28,100 113,460 120,100