FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 70,900 86,910 296, 656 1,350 455,816 143,500 (43,625) $ 555,691 $ 87,500 64,625 265,800 2,175 420,100 122,000 (53,000) $489,100 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 $ 67, 141 14,200 81,341 58,000 139,341 $135,675 8,800 144,475 62, 750 207, 225 183,750 58,500 174, 100 $555, 691 164,250 0 117,625 $ 489, 100 $652,500 299,000 353,500 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 34,750 Other expenses 146,400 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 181,150 (19,125) 153, 225 43,850 $109,375 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $19,125 (details in b). b. Sold equipment costing $88,875, with accumulated depreciation of $44,125, for $25,625 cash. c. Purchased equipment costing $110,375 by paying $58,000 cash and signing a long-term note payable fort d. Borrowed $5,400 cash by signing a short-term note payable. e. Paid $57,125 cash to reduce the long-term notes payable. f. Issued 3,900 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $52,900. 0.20.02 FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 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: Cash flows from investing activities Cash flows from financing activities: + Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year