Statement of Cash Flows—Indirect Method Refer to all of the facts in Problem 12-3.

Required 1. Prepare a statement of cash fl ows for 2010 using the indirect method in the Operating Activities section.

2. On the basis of your statement in (1), draft a brief memo to the president to explain why cash decreased during such a profi table year. Include in your explanation any recommendations for improving the company’s cash fl ow in future years.

AppendixLO1