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, and (4) all debits to Accounts Payable reflect cash payments for Inventory. FORTEN COMPANY Income Statement For Current Year Ended 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 $ 602,500 289,000 313,500 $136,400 24,750 161,150 (9,125) Comparative Balance Sheets December 31 143,225 29,850 $ 113,375 Current Year Prior Year Assets Cash Accounts receivable Inventory Prepaid expenses $ 55,900 71,810 281,656 1,250 $ 77,500 54,625 255,800 1,975 Equipment Total current assets Accumulated depreciation-Equipment Total assets Liabilities and Equity 410,616 389,900 153,500 112,000 (38,625) (48,000) $525,491 $ 453,900 Accounts payable $ 57,141 $ 120,675 Long-term notes payable 74,200 59,550 Total liabilities 131,341 180,225 Equity Common stock, $5 par value 168,750 154,250 Paid-in capital in excess of par, common stock 43,500 Retained earnings: 181,900 119,425 Total liabilities and equity $525,491 $ 453,900 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $9,125 (details in b). b. Sold equipment costing $58,875, with accumulated depreciation of $34,125, for $15,625 cash. c. Purchased equipment costing $100,375 by paying $38,000 cash and signing a long-term notes payable for the balance. d. Paid $47,725 cash to reduce the long-term notes payable. e. Issued 2,900 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $50,900. Required: Prepare a complete statement of cash flows using the direct method. (Amounts to be deducted should be indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities 4 Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year $ 0 0 S 0 $