Question 2 (6.5 Points) IUC Ltd. operates under ideal conditions of uncertainty. The company began operations by buying a machine to produce its specialized product. The machine is expected to last for 3 years, with no salvage value. The purchase of the machine was financed from the proceeds of a capital stock issue. Cash flows from the product will be $1,000 for each year if the state of nature is high and $400 per year if the state is low. Assume that cash flows are received at year-end. Objective state probabilities each year are 0.6 for the high state and 0.4 for the low state. IUC's cost of capital is 5% per annum. The company plans to pay a dividend of $100 at the end of years 1 and 2, with remaining cash distributed at the end of year 3. During year 1, the high state happens. Required Prepare, in good form, an income statement for IUC for year 1 and a balance sheet as at the end of year 1