Exercise 13-2 An analysis of comparative balance sheets, the current year’s income statement, and the general ledger accounts of Conard Corp. uncovered the following items. Assume all items involve cash unless there is information to the contrary.(a) Payment of interest on notes payable (h) Issuance of capital stock(b) Exchange of land for patent. (i) Amortization of patent.(c) Sale of building at book value. (j) Issuance of bonds for land.(d) Payment of dividends. (k) Purchase of land. (e) Depreciation. (l) Conversion of bonds into(f) Receipt of dividends on investment common stock. in stock. (m) Loss on sale of land. (g) Receipt of interest on notes receivable. (n) Retirement of bond. InstructionsIndicate how each item should be classified in the statement of cash flows using these four major classifications: operating activity (indirect method), investing activity, financing activity, and significant noncash investing and financing activity.Exercise 13-5 The current sections of Leach Inc.’s balance sheets at December 31, 2010 and 2011, are presented here.Leach’s net income for 2011 was $153,000. Depreciation expense was $24,000.2011 2010Current assets Cash $105,000 $99,000 Accounts receivable 110,000 89,000Inventory 158,000 172,000Prepaid expenses 27,000 22,000Total current assests $400,000 $382,000 Current liabilites Accrued expenses payable $15,000 $5,000 Accounts payable 85,000 92,000Total current liabilities $100,000 $97,000 InstructionsPrepare the net cash provided by operating activities section of the company’s statement of cash flows for the year ended December 31,2011, using the indirect method.Exercise 13-7 Willingham Corporation’s comparative balance sheets are presented below.WILLNGHAM CORPORATIONComparative Balance SheetsDecember 312011 2010Cash $14,300 $10,700 Accounts receivable 21,200 23,400Land 20,000 26,000Building 70,000 70,000Accumulated depreciation -15,000 -10,000Total $110,500 $120,100 Accounts payable $12,370 $31,100 Common stock 75,000 69,000Retained earnings 23,130 20,000Total $110,500 $120,100 Additional information:1. Net income was $22,630. Dividends declared and paid were $19,5000.2. 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 $4,900.Instructions(a) Prepare a statement of cash flows for 2011 using the indirect method.(b) Compute free cash flow.”