Forten Company, a merchandiser, recently completed its calendar-year 2017 operations. 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, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debited to Prepaid Expenses. The company's income statement and balance sheets follow FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 AssetS Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets $ 51,400 67,310 277,156 74,500 51,625 252,800 1,300 397,166 156, 500 37,125 $516,541 2,025 380,950 109,000 1 (46,500) 443,450 Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total 1iabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings $ 54,141 10,300 64,441 64, 500 128,941 116,175 6,200 122,375 49,750 172,125 164,7560 38,500 151,250 184,358120,075 516,541 443,450 Total liabilities and equity FORTEN COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses $587,500 286,000 301,500 Depreciation expense $ 21,750 133,400 155,150 Other expenses Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 6,125 140,225 25,650 $114,575