12 Required information [The following information applies to the questions displayed below.) Forten Company's current year income statement, comparative balance sheets, and additional information follow. For the year. (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of Inventory are on credit, and (4) all debits to Accounts Payable reflect cash payments for inventory PORTEN COMPANY Income Statement For Current Year Ended December 31 Sales $ 617,500 Cont of goods sold 292,000 Gross profit 325,500 Operating expenses (exelading depreciation) $ 139,400 Depreciation expense 27.750 167,150 Other gains (losses) Loos on sale of equipment (12.125) Income before taxes 146.225 Income taxes expense 34,050 Net Income $ 112,175 Ded PORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year Assets Cash hccounts receivable Inventory Prepaid expenses Total Current assets Equipment Accumulated depreciation Equipment Total asseto Liabilities and Equity $ 60,400 76,340 286, 156 1,280 424,176 150,500 (40.125 $ 534,551 $ 30,500 57.625 258, 800 2,035 398,960 115,000 (49,500 $ 464, 460 Required information FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 60,400 76,340 286, 156 1,280 424,176 150,500 (40,125) $ 534,551 $ 80,500 57,625 258, 800 2,035 398,960 115,000 (49,500) $ 464, 460 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 60,141 73,600 133,741 $ 125, 175 63,150 188,325 173,250 48,000 179,560 $ 534,551 157,250 0 118,885 $ 464,460 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $12,125 (details in b). b. Sold equipment costing $67,875, with accumulated depreciation of $37125, for $18,625 cash. c. Purchased equipment costing $103,375 by paying $44,000 cash and signing a long-term notes payable for the balance. d. Paid $48,925 cash to reduce the long-term notes payable, e. Issued 3,200 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $51,500. Required information Required: 1. Prepare a complete statement of cash flows using the indirect method for the current year. (Amounts to be deducted should be Indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations Income statement items not affecting cash Changes in current assets and current liabilities $ 0 Cash flows from investing activities FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities $ 0 Cash flows from investing activities 0 Cash flows from financing activities 0 $ 0 Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year $ 0