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 Sales Cost of goods sold Gross profit Income Statement For Current Year Ended December 31 Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 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 $ 682,500 305,000 377,500 $ 152,400 40,750 193.150 (25,125) FORTEN COMPANY Comparative Balance Sheets Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity December 31 159.225 52,250 $ 106,975 Current Year Prior Year $ 79,900 95,970 305,656 1,410 $ 93,500 70,625 271,800 2,295 482,936 438,220 128,000 137,500 (46,625) $573,811 $ 73,141 71,000 144,141 (56,000) $ 510,220 $144,675 78,750 223,425 192,750 67,500 169,420 170,250 0 116,545 $ 573,811 $510,220