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 $ 632,500 Cost of goods sold 295,000 Gross profit Operating expenses (excluding depreciation) $ 142,400 Depreciation expense Other gains (losses) 337,500 30,750 173,150 Loss on sale of equipment Income before taxes (15,125) Income taxes expense Net income Assets Cash Accounts receivable FORTEN COMPANY Comparative Balance Sheets December 31 149,225 38,250 $ 110,975 Current Year Prior Year $ 64,900 80,870 290,656 1,310 $ 83,500 60,625 261,800 2,095 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 437,736 147,500 (41,625) $ 543,611 $ 63,141 73,000 136,141 177,750 52,500 177,220 $ 543,611 408,020 118,000 (51,000) $ 475,020 $ 129,675 66,750 196,425 160,250 0 118,345 $ 475,020