The comparative balance sheets and an Income statement for Raceway Corporation follow. Balance Sheets As of December 31 Year 2 Year 1 Assets Cash Equipment Accounts receivable Inventory Prepaid rent Accumulated depreciation Land $73,578 30,491 $39,860 22,360 157,147 172,860 2,420 4,840 253,370 (147,650) 286,790 (238,190) 191,620 80,620 Total assets $560,976 $369,140 Liabilities Accounts payable (inventory) $69,751 79,120 Salaries payable 24,290 20,820 Stockholders' equity Common stock, $50 par value 255,500 200,500 Retained earnings 211,435 68,700 Total liabilities and equity $560,976 $369,140 Income Statement For the Year Ended December 31, Year 2 Sales $1,503,000 Cost of goods sold (798,795) Gross profit 704,205 Operating expenses Depreciation expense Rent expense Salaries expense Other operating expenses Net income Other Information 1. Purchased land for $111,000. 2. Purchased new equipment for $100,700. (22,280) (25,820) (253,580) (259,790) $142,735 3. Sold old equipment that cost $134,120 with accumulated depreciation of $112,820 for $21,300 cash. 4. Issued common stock for $55,000. Required Prepare the statement of cash flows for Year 2 using the Indirect method. (Cash outflows should be indicated with a minus sign.) Cash flows from operating activities: Net income RACEWAY CORPORATION Statement of Cash Flows For the Year Ended December 31, Year 2 Plus: Decreases in current assets and increases in current liabilities