forten company

Required information Use the following information for the Problems below. (The following information applies to the questions displayed below.) Forten Company's current year income statement, comparative balance sheets, and additional information follow. 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. FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year 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 $ 52,900 68,810 278,656 1,270 401,636 155,500 (37,625) $519,511 $ 75,500 52,625 253,800 1,995 383,920 110,000 (47,000) $446,920 $ 55, 141 10,600 65,741 64,000 129,741 $117,675 6,400 124,075 50,750 174,825 $592,500 287,000 305,500 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 22,750 Other expenses 134,400 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 157, 150 (7,125) 141,225 27,050 $114, 175 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $7,125 (details in b). b. Sold equipment costing $52,875, with accumulated depreciation of $32,125, for $13,625 cash. c. Purchased equipment costing $98,375 by paying $34,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,200 cash by signing a short-term note payable. e. Paid $51,125 cash to reduce the long-term notes payable. f. Issued 2,700 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $50,500. ! Required information 1. Prepare a complete statement of cash flows using the indirect method for the current year. indicated with a minus sign.) 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: 0 Cash flows from investing activities 0 Cash flows from financing activities: 0