The comparative balance sheets and an income statement for Raceway Corporation follow:

Income Statement
For the Year Ended December 31, Year 2
Sales ............................................................$480,000
Cost of goods sold .....................................(264,000)
Gross profit ..................................................216,000
Operating expenses
Depreciation expense .................................(11,400)
Rent expense ................................................(7,000)
Salaries expense ...........................................(95,200)
Other operating expenses ............................(76,000)
Net income ......................................................$ 26,400

Other Information
1. Purchased land for $66,000.
2. Purchased new equipment for $62,000.
3. Sold old equipment that cost $66,000 with accumulated depreciation of $56,000 for $10,000 cash.
4. Issued common stock for $30,000.

Required
Prepare the statement of cash flows for Year 2 using the indirect method.

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Balance Sheets As of December 31 Year 2 Year 1 Assets $ 6,300 $ 48,400 7,260 56,000 2,140 144,000 (118,000) 50,000 $189,800 Cash Accounts receivable 10,200 Merchandise inventory Prepaid rent Equipment Accumulated depreciation Land 45,200 700 140,000 (73,400) 116,000 $245,000 Total assets Liabilities $ 37,200 12,200 $ 40,000 10,600 Accounts payable (inventory) Salaries payable Stockholders' equity Common stock, $50 par value Retained earnings 150,000 45,600 $245,000 120,000 19,200 $189,800 Total liabilities and equity