E13-7 Meera Corporation’s

Price: $1.99


Meera Corporation’s comparative balance sheets are presented below.

Meera Corporation
Comparative Balance Sheets
				2,014	2,013
Cash				14,700	10,700
Accounts receivable				20,800	23,400
Land				20,000	26,000
Buildings				70,000	70,000
Accumulated depreciation - buildings				(15,000)	(10,000)
Total				110,500	120,100
Accounts payable				12,370	28,100
Common stock				75,000	72,000
Retained earnings				23,130	20,000
Total				110,500	120,100

Additional information:
1. Net income was $22,630. Dividends declared and paid were $19,500.
2. All other changes in noncurrent account balances had a direct effect on cash flows,
except the change in accumulated depreciation. The land was sold for $5,000.

Instructions
(a) Prepare a statement of cash flows for 2014 using the indirect method.
(b) Compute free cash flow.