Use the following data for Hines Music Company to prepare a statement of cash flows using the indirect method for the year ended June $30,2010.$

Hines Music Company

Income Statement

For the Year Ended June $30,2010$

Sales

$$700,000$

Less expenses

Cost of goods sold

$$400,000$

Depreciation expense

$40,000$

Administrative expenses

$104,000$

Selling expenses

$70,000$

Loss on sale of investment

$1,000$

$615,000$

Income before income taxes

$85,000$

Income taxes expense

$20,000$

Net income

$ $65,000$

Hines Music Company

Comparative Balance Sheets

June $30,2010$ and $2009$

Assets

$2010$

$2009$

Cash

$ $9,000$

$ $30,000$

Accounts receivable $($net$)$

$70,000$

$55,000$

Inventory

$80,000$

$100,000$

Prepaid insurance

$6,000$

$5,000$

Long$-$term investments

$40,000$

$50,000$

Plant and equipment

$160,000$

$80,000$

Accumulated depreciation

$(40,000)$

$(24,000)$

Total assets

$$325,000$

$$296,000$

Liabilities

Accounts payable

$ $4,000$

$ $12,000$

Wages payable

$440$

$520$

Income taxes payable

$1,560$

$1,480$

Notes payable

$40,000$

$24,000$

Total liabilities

$ $46,000$

$ $38,000$

Stockholders' Equity

Common stock

$ $116,000$

$$130,000$

Retained earnings

$163,000$

$128,000$

Total stockholders' equity

$$279,000$

$$258,000$

Total liabilities and stockholders' equity

$$325,000$

$$296,000$

Additional information:

A plant asset costing $$40,000$ was sold for its book value of $$16,000.$

A long$-$term investment was sold for $$9,000.$

The outstanding notes are long$-$term. A $$16,000$ note was issued during $2010.$