Problem $2$

Bills Company had the balance sheet shown below at December $31,2024.$

During $2025,$ the following occurred:

Bills Company sold part of its investment portfolio for $$20,000.$ This transaction resulted in a

loss of $$2,100$ for the company. The company classifies its investments as available$-$for$-$sale.

A tract of land was purchased for $$25,000$ cash.

Long$-$term notes payable in the amount of $$30,000$ were retired before maturity paying

$$30,000$ cash.

An additional $$43,000$ in common stock was issued at par.

Dividends of $$20,000$ were declared and paid to stockholders.

Net income for $2025$ was $$21,000$ which included depreciation of $$9,000.$

Land was purchased through the issuance of $$61,000$ in bonds payable.

At December $31,2025,$ Cash was $$46,100,$ Accounts Receivable was $$61,800,$ and Accounts

Payable remained at $$61,000.$

Required:

Prepare a statement of cash flows for $2025.$

Prepare a free cash flow analysis.