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Rodriquez Corporations comparative balance sheets are as follows.
Rodriquez Corporation
Comparative Balance Sheets
December 31 2022 2021
Cash. $15,200 $17,700
Accounts receivable 25,200 22,300
Investments 20,000 16,000
Equipment 60,000 70,000
Accumulated depreciationequipment (14,000) (10,000)
Total $106,400 $116,000
Accounts payable $14,600 $11,100
Bonds payable 10,000 30,000
Common stock 50,000 45,000
Retained earnings 31,800 29,900
Total $106,400 $116,000
Additional information:
Net income was $18,300. Dividends declared and paid were $16,400.
Equipment which cost $10,000 and had accumulated depreciation of $1,200 was sold for $3,300.
No noncash investing and financing activities occurred during 2022.
Bonds were retired at their carrying value. Instructions
a.Prepare a statement of cash flows for 2022 using the indirect method.
b.Compute free cash flow.
Answer & Explanation
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