Comparative Balance Sheets December 31 Prior Year Current Year Assets $ 61,900 77,850 287,656 1,290 428,696 149,500 (48,625) $ 537,571 S 81,500 58,625 259,880 2,855 481,988 116,000 (50,000) S 467,988 Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Common stock, 55 par value Paid-in capital in excess of par, common stock Retained earnings $ 126,675 7,600 134,275 56,750 191,025 $ 61,141 12,400 73,541 61,000 134, 541 158,250 174,750 49,500 178,780 $ 537,571 118,705 $ 467,98e Total liabilities and equity FORTEN COMPANY Income Statenent For Current Year Ended Decenber 31 $ 622,500 293,000 329,500 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses Other gains (losses) Loss on sale of equioment $ 28,750 148,400 169,150 (13,125) 147,225 35,450 $ 111,775 Income before taxes Income taxes expense Net income Additlonal Information on Current Year Transactlons a. The loss on the cash sale of equipment was $13,125 (detals in o). b. Sold equipment costing $70,875, with accumulated depreciation of $38.125. for $19,625 cash. c. Purchased equipment costing $104.375 by paying $46.000 cash and signing a iong-term note payable for the balance d. Borrowed $4.800 cash by signing a snort-term note payable e. Paid $54.125 cash to reduce the long-term notes payabie f. Issued 3,300 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $51700. FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Net income 111,775 Adjustments to reconcile net income to net cash provided by operations: Depreciation expense Loss on disposal of equipment Notes payable long-term increase Prepaid expense decrease Prepaid expense increase 111,775 Salaries payable decrease Salaries payable increase Cash flows from financing activities. 111,775 Net increase (decrease) in cash Cash balance at December 31. prior year 111,775 Cash balance at December 31. current year