Comparative financial statement data for Carmono Company follow:

	This Year	Last Year
Assets
Cash	$ 6.00	$ 11.00
Accounts receivable	44.00	37.00
Inventory	85.00	71.40
Total current assets	135.00	119.40
Property, plant, and equipment	222.00	188.00
Less accumulated depreciation	43.20	32.40
Net property, plant, and equipment	178.80	155.60
Total assets	$ 313.80	$ 275.00
Liabilities and Stockholders Equity
Accounts payable	$ 51.00	$ 43.00
Common stock	106.00	82.00
Retained earnings	156.80	150.00
Total liabilities and stockholders equity	$ 313.80	$ 275.00

For this year, the company reported net income as follows:

Sales	$ 700.00
Cost of goods sold	420.00
Gross margin	280.00
Selling and administrative expenses	260.00
Net income	$ 20.00

This year Carmono declared and paid a cash dividend. There were no sales of property, plant, and equipment during this year. The company did not repurchase any of its own stock this year.

Required:

1. Using the indirect method, prepare a statement of cash flows for this year.

2. Compute Carmonos free cash flow for this year.