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 $ 637,500 Cost of goods sold 296,000 Gross profit Operating expenses (excluding depreciation). Depreciation expense Other gains (losses) Loss on sale of equipment 341,500 $ 143,400 31,750 175,150 (16,125) Income before taxes Income taxes expense Net income 150,225 39,650 $ 110,575 FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 66,400 82,380 292,156 1,320 442,256 146,500 (42,125) $ 546,631 $ 64,141 72,800 136,941 179,250 $ 84,500 61,625 262,800 2,115 411,040 119,000 (51,500) $ 478,540 $ 131,175 67,950 199,125 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable 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 Additional Information on Current Year Transactions 161,250 54,000 176,440 118,165 $ 546,631 $ 478,540 a. The loss on the cash sale of equipment was $16,125 (details in b). b. Sold equipment costing $79,875, with accumulated depreciation of $41,125, for $22,625 cash. c. Purchased equipment costing $107.375 bv Daving $52.000 cash and signing a long-term notes pavable for the