Comparative financial statement data for Carmono Company follow:

	This Year	Last Year
Assets
Cash	$ 4.50	$ 8.00
Accounts receivable	38.00	31.00
Inventory	77.50	63.60
Total current assets	120.00	102.60
Property, plant, and equipment	213.00	182.00
Less accumulated depreciation	40.80	30.60
Net property, plant, and equipment	172.20	151.40
Total assets	$ 292.20	$ 254.00
Liabilities and Stockholders Equity
Accounts payable	$ 46.50	$ 40.00
Common stock	94.00	73.00
Retained earnings	151.70	141.00
Total liabilities and stockholders equity	$ 292.20	$ 254.00

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

Sales	$ 550.00
Cost of goods sold	330.00
Gross margin	220.00
Selling and administrative expenses	200.00
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.