The comparative balance sheets and an income statement for Raceway Corporation follow.

Balance Sheets

As of December $31$

Year $2$ Year $1$

Assets

Cash $$72,702$ $$40,570$

Accounts receivable $28,44620,860$

Inventory $154,711170,180$

Prepaid rent $2,4204,840$

Equipment $253,350286,610$

Accumulated depreciation $(150,190)(235,280)$

Land $187,18075,780$

Total assets $$548,619$ $$363,560$

Liabilities

Accounts payable $($inventory$)$ $$63,02471,490$

Salaries payable $34,09029,220$

Stockholders$$ equity

Common stock, $$50$ par value $248,000201,000$

Retained earnings $203,50561,850$

Total liabilities and equity $$548,619$ $$363,560$

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 $(24,770)$

Rent expense $(23,670)$

Salaries expense $(256,350)$

Other operating expenses $(257,760)$

Net income $$141,655$

Other Information

Purchased land for $$111,400.$

Purchased new equipment for $$97,900.$

Sold old equipment that cost $$131,160$ with accumulated depreciation of $$109,860$ for $$21,300$ cash.

Issued common stock for $$47,000.$

Required

Prepare the statement of cash flows for Year $2$ using the indirect method.