FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 $ 75,400 91,440 301,156 1,380 469,376 140,500 (45,125) $564,751 $ 90,500 67,625 268,800 2,235 429,160 125,000 (54,500). $ 499,660 Assets 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, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 70,141 15,100 85,241 56,500 141,741 $140,175 9,400 149,575 65,750 215, 325 196,750 54,500 171,760 $564,751 167,250 0 117,085 $499,660 $667,500 302,000 365,500 FORTEN COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 37,750 Other expenses 149,400 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 187,150 (22,125) 156, 225 48,050 $108,175 a. The loss on the cash sale of equipment was $22,125 (details in b). b. Sold equipment costing $97,875, with accumulated depreciation of $47,125, for $28,625 cash. c. Purchased equipment costing $113,375 by paying $64,000 cash and signing a long-term note payable for the balance. d. Borrowed $5,700 cash by signing a short-term note payable. e. Paid $58,625 cash to reduce the long-term notes payable. f. Issued 4,200 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $53,500. Required: 1. Prepare a complete statement of cash flows; report its operating activities using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Year Ended December 31, 2017 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations: Cash flows from investing activities Cash flows from financing activities: Net increase (decrease) in cash Cash balance at beginning of year Cash balance at end of year