Problem 2: (30 pts) Based on the following information, prepare the statement of cash flows using the indirect method. Smo Company Balance Sheet 2010 2009 Change Current assets: Cash Accounts receivable Inventory Interest Receivable Prepaid expenses $14,200 28,600 83,600 1,900 2,500 s5,300 26,900 87,200 700 $8,900 1,700 (3,600) 1,9001,200 600 Long-term assets Plant & equipment (net) Land 4,100 60,000 29,000 53,500 49,400 Total Assets 273,300 231,400 Current liabilities: Accounts payable Interest payable Other accruals Tax payable Salary payable 31,400 4,400 13,700 8,900 3,100 28,800 4,900 16,000 7,700 2,600 (500) (2,300) 1,200 (3,500) Long-term liabilities Notes payable 75,000 100,000(25,000) Stockholders equity Common stock (no par) Retained earnings 88,300 64,700 2.700 23,600 45,800 Total Liabilities and Equity 273,300 231,400 Income Statement For the Year Ended December 31, 2010 Sales Interest Revenue $220,000 8,600 228,600 Total Revenue Cost of goods sold Depreciation expense Salary expense Other operating expenses Interest expense Tax expense Total expense 70,600 4,000 27,800 10,500 11,600 Net Income 75,000