Newman Corporation's Comparative Balance Sheets Are Presented Below

question 114

Essay

Newman Corporation's comparative balance sheets are presented below.
Additional information:
1. Net income was $15,300. Dividends declared and paid were $13,400.
2. Equipment which cost $10,000 and had accumulated depreciation of $2,200 was sold for $3,800.
3. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation.
Instruction
(a) Prepare a statement of cash flows for 2010 using the indirect method.
(b) Compute free cash flow.

---

Definitions:

Pancreatic Lipase

An enzyme that digests lipids.

Lipids

A group of naturally occurring molecules that include fats, waxes, and certain vitamins, essential for energy storage and cell membrane structure.

Vitamin A

A fat-soluble vitamin important for normal vision, immune function, and reproduction.

Bones

The hard, dense organs that form the framework of the human body, essential for movement, protection of internal organs, and storage of minerals.