Could you do it step by step and explaining where you got the numbers please.

Only A and C

Waterways (This is a continuation of the Waterways case from Chapters 1 12) WP13 Waterways prepared the balance sheet and income statement for the irrigation installation division for 2020. Now the company also needs to prepare a statement of cash flows for the same division. The comparative balance sheets for Waterways Corporation's Imigation Installation Division for the years 2019 and 2020 and the income statement for the year 2020 are presented below Additional information: 1. Waterways sold a company vehicle for $24,000. The vehicle had been used for 10 years It cost $80,000 when purchased and had a 10-year life and a $6,000 salvage value. Straight-line depreciation was used. Waterways purchased with cash new equipment costing $209,200. Prepaid expenses increased by $33,960. All changes in accounts payable relate to inventory pruchases 2. 3. WATERWAYS CORPORATION-INSTALLATION DIVISION Balance Sheets December 31 Assets 2020 2019 Current assets Cash Accounts receivable Work in process 836,797 746,681 542,685 680,750 702,159 16,766 76,550 7,500 42,590 Prepaid expenses Total current assets 2,313022 339.456 Property, plant, and equipment Land Buildings 300,000 300,000 450,000 929,400450,000 800,200 ment Furnishings Accumulated depreciation 40,416 (482,523)(485204) Total property, plant, and equipment 1.237,293 .105.412 2,444,868 40.416 Total assets $3,550,315 Liabilities and Stockholders' Equity Current liabilities Accounts payable Income taxes payable Wages payable Interest payable Other current liabilities Revolving bank loan payable 157,095 128,360 79,989 ,984 01,344 1,187 14,515 293,658 140,000 433,658 1,250,000 15,246 15,000_ Total current liabilities 225,579 Long-term liabilities Note payable Total liabilities 225,579 Stockholders equity Common stock Retained earnings 1,250,000 969,289 3,116.6572.219.289 Total liabilities and stockholders' equity $3.550.315 $2.444.868 866,657 Total stockholders equity WATERWAYS CORPORATION-INSTALLATION DIVISION Income Statement For the Year Ending December 31, 2020 Sales Less: Cost of goods sold Gross profi Operating expenses 5,536,077 3,132,777 2,403,300 Advertising 50,000 400,000 584,640 71,319 21,200 Insurance Salaries and wages Depreciation Other operating expenses Total operating expenses Income from operations Other income 1,127,159 1,276,141 Gain on sale of equipment Other expenses 18,000 Interest expense Net other income and expenses Income before income tax Income tax expense Net income (12,187) 5,813 1,281,954 384,586 $ 897,368 Instructions For the year 2017 (a) Prepare a statement of cash flows using the indirect method (b) Prepare a statement of cash flows using the direct method (c) Determine free cash flow