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 companys income statement and balance sheets follow.

FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016
	2017				2016
Assets
Cash	$	78,400			$	92,500
Accounts receivable		94,460				69,625
Inventory		304,156				270,800
Prepaid expenses		1,400				2,275
Total current assets		478,416				435,200
Equipment		138,500				127,000
Accum. depreciationEquipment		(46,125	)			(55,500	)
Total assets	$	570,791			$	506,700
Liabilities and Equity
Accounts payable	$	72,141			$	143,175
Short-term notes payable		15,700				9,800
Total current liabilities		87,841				152,975
Long-term notes payable		55,500				67,750
Total liabilities		143,341				220,725
Equity
Common stock, $5 par value		200,750				169,250
Paid-in capital in excess of par, common stock		56,500				0
Retained earnings		170,200				116,725
Total liabilities and equity	$	570,791			$	506,700

FORTEN COMPANY Income Statement For Year Ended December 31, 2017
Sales				$	677,500
Cost of goods sold					304,000
Gross profit					373,500
Operating expenses
Depreciation expense	$	39,750
Other expenses		151,400			191,150
Other gains (losses)
Loss on sale of equipment					(24,125	)
Income before taxes					158,225
Income taxes expense					50,850
Net income				$	107,375

Additional Information on Year 2017 Transactions

The loss on the cash sale of equipment was $24,125 (details in b).

Sold equipment costing $103,875, with accumulated depreciation of $49,125, for $30,625 cash.

Purchased equipment costing $115,375 by paying $68,000 cash and signing a long-term note payable for the balance.

Borrowed $5,900 cash by signing a short-term note payable.

Paid $59,625 cash to reduce the long-term notes payable.

Issued 4,400 shares of common stock for $20 cash per share.

Declared and paid cash dividends of $53,900.

Required: Prepare a complete statement of cash flows; report its operating activities according to the direct method. (Amounts to be deducted should be indicated with a minus sign.)