Prepare the statement of cash flows using the indirect method. ( \(L O 2,5)\)

Use the following information for LAW Office Products and Supplies Inc. to prepare a statement of cash flows for the year ended December 31, 2007, using the indirect method.

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Assets Cash Accounts receivable Inventories LAW Office Products and Supplies Inc. Balance Sheet Land Equipment Accumulated depreciation Total assets At December 31, 2007 2006 $ 55,000 $ 23,500 78,000 64,000 180,000 169,000 135,000 105,000 350,000 260,000 (90,000) (60,000) $ 708,000 $ 561,500