The bike is definitely worth fixing in my opinion, especially since you got for nothing. It sounds like the chain and rear cassette need to be replaced for starters. I don't think you will need to spend much on that bike to get in good riding shape. I'd check ebay for the cassette and a local bike shop for a new chain. There are a bunch of videos on u-tube that do a nice job of getting you going in the right direction. You will probably need to get a few basic bike specific tools to get started. Good luck with the bike!