FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 73,900 89,930 299,656 1,370 464,856 141,500 (44,625) $561,731 $ 89,500 66,625 267,800 2,215 426, 140 124,000 (54,000) $496, 140 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 $ 69,141 14,800 83,941 57,000 140, 941 $138,675 9,200 147,875 64,750 212,625 186,750 61,500 172,540 $561,731 166, 250 0 117,265 $496, 140 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 36,750 Other expenses 148,400 Other gains (losses) $662,500 301,000 361,500 185, 150 $662,500 301,000 361,500 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 36,750 Other expenses 148,400 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 185,150 (21,125) 155, 225 46,650 $108,575 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $21,125 (details in b). b. Sold equipment costing $94,875, with accumulated depreciation of $46,125, for $27,625 cash. c. Purchased equipment costing $112,375 by paying $62,000 cash and signing a long-term note payable for the balance. d. Borrowed $5,600 cash by signing a short-term note payable. e. Paid $58,125 cash to reduce the long-term notes payable. f. Issued 4,100 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $53,300