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, Assets Cash FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 63,400 79,360 $ 82,500 59,625 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 289,156 260,800 $ 62,141 1,300 2,075 405,000 433,216 148,500 (41,125) $ 540,591 117,000 (50,500) $ 471,500 $128,175 12,700 7,800 74,841 135,975 60,500 57,750 135,341 193,725 Equity Common stock, $5 par value 176,250 159,250. Paid-in capital in excess of par, common stock 51,000 Retained earnings 178,000 118,525 Total liabilities and equity $540,591 $ 471,500 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales $627,500 Cost of goods sold 294,000 Gross profit 333,500 Operating expenses Depreciation expense Other expenses Other gains (losses) $ 29,750 141,400 171,150 Loss on sale of equipment (14,125) Income before taxes Income taxes expense Net income 148,225 36,850 $111,375 a. The loss on the cash sale of equipment was $14,125 (details in b). b. Sold equipment costing $73,875, with accumulated depreciation of $39,125, for $20,625 cash. c. Purchased equipment costing $105,375 by paying $48,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,900 cash by signing a short-term note payable. e. Paid $54,625 cash to reduce the long-term notes payable. f. Issued 3,400 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $51,900. Problem 12-3A Indirect: Statement of cash flows LO A1, P2, P3 Required: 1. Prepare a complete statement of cash flows using the indirect method for the current year. (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 Adjustments to reconcile net income to net cash provided by operations: $ 0 Cash flows from investing activities 9 Prev 2 3 of 7 Next >