Problem 14-19B Using financial statements to prepare a statement of cash flows-indirect method The comparative balance sheets and an income statement for Wang Beauty Products Inc. are shown as follows. Balance Sheets As of December 31 Year 2 Year 1 Assets Cash $ 68,800 $ 40,600 Accounts receivable 30,000 22,000 Merchandise inventory 160,000 176,000 Prepaid rent 2,400 4,800 Equipment 256,000 288,000 Accumulated depreciation (146,800) (236,000) Land 192,000 80,000 $562,400 $375,400 Total assets Liabilities and equity Accounts payable (inventory) $ 67,000 $ 76,000 Salaries payable 28,000 24,000 Stockholders' equity Common stock, $50 par value 250,000 200,000 Retained earnings 217,400 75,400 Total liabilities and equity $562,400 $375,400