Problem 12-19A Using financial statements to prepare a statement of cash flows-Indirect method LO 12 1, 12-3,12-4 The comparative balance sheets and an income statement for Raceway Corporation follow. Balance Sheet:s As of December 31 Year 2 Year 1 Assets Cash Accounts receivable Merchandise inventory Prepaid rent Equipment Accumulated depreciation Land $ 76,094 41,370 20,420 174,830 4,700 289,850 27,846 158,938 2,35e 259,160 (148,41) (236,180) 189,99976,79e $ 565,968 371,780 Total assets Liabilities Accounts payable (inventory) 65,651 74,47e 21,410 Salaries payable 24,978 Stockholders equity Common stock, $50 par value Retained earnings 254, 500 200,5ee 220,83975,486 565,968 371,780 Total liabilities and equity Income Statement For the Year Ended December 31, Year 2 Sales Cost of goods sold Gross profit Operating expenses 1,500,000 797,201 702,799 Depreciation expense Rent expense Salaries expense Other operating expenses (24,120) (24,140) (250,030) 259,07e Net income $ 145,439 Other Information 1. Purchased land for $113,200. 2. Purchased new equipment for $100,800. 3. Sold old equipment that cost $131,490 with accumulated depreclation of $111,890 for $19,600 cash. 4. Issued common stock for $54,000. or common stock tor 934.000t Required Prepare the statement of cash flows for Year 2 using the Indirect method.(Amounts to be deducted should be Indicated with a minus sign.) RACEWAY CORPORATION Statement of Cash Flows For the Year Ended December 31, Year 2 Cash flows from operating activities: Plus: Increases in current assets and Decreases in current liabilities Less: Increases in Current Assets and Decreases in current liabilities: Plus: Noncash charges Cash flows from investing activities: Cash flows from financing activities: Ending cash balance