FORTEN COMPANY Income Statement For Current Year Bnded December 31 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income FORTEN COMPANY Comparative Balance sheets December 31 Assets Current Year Prior Year Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Long-tern noten payable Total liabilities Equity common = tock, $5 par value Pald-in capital in excess of par, common stock Retained earnings Total liabilities and equity $677,500 $151,400 304,000373,500 39,750191,150 \begin{tabular}{r} (24,125) \\ \hline 158,225 \\ 50,850 \\ \hline$107,375 \\ \hline \end{tabular} Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $24,125 (details in b). b. Sold equipment costing $103,875, with accumulated depreciation of $49,125, for $30,625 cash. c. Purchased equipment costing $115,375 by paying $68,000 cash and signing a long-term notes payable for the balance. d. Paid $53,725 cash to reduce the long-term notes payable. e. Issued 4,400 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $53,900. Required: Prepare a complete statement of cash flows using the direct method. Note: Amounts to be deducted should be indicated with a minus sign