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 $341,500$

Operating expenses $($excluding depreciation$)$ $ $143,400$

Depreciation expense $31,750175,150$

Other gains $($losses$)$

Loss on sale of equipment $(16,125)$

Income before taxes $150,225$

Income taxes expense $39,650$

Net income $ $110,575$

FORTEN COMPANY

Comparative Balance Sheets

December $31$

Current Year Prior Year

Assets

Cash $ $66,400$ $ $84,500$

Accounts receivable $82,38061,625$

Inventory $292,156262,800$

Prepaid expenses $1,3202,115$

Total current assets $442,256411,040$

Equipment $146,500119,000$

Accumulated depreciation$$Equipment $(42,125)(51,500)$

Total assets $ $546,631$ $ $478,540$

Liabilities and Equity

Accounts payable $ $64,141$ $ $131,175$

Long$-$term notes payable $72,80067,950$

Total liabilities $136,941199,125$

Equity

Common stock, $$5$ par value $179,250161,250$

Paid$-$in capital in excess of par, common stock $54,0000$

Retained earnings $176,440118,165$

Total liabilities and equity $ $546,631$ $ $478,540$

Additional Information on Current Year Transactions

The loss on the cash sale of equipment was $$16,125($details in b$).$

Sold equipment costing $$79,875,$ with accumulated depreciation of $$41,125,$ for $$22,625$ cash.

Purchased equipment costing $$107,375$ by paying $$52,000$ cash and signing a long$-$term notes payable for the balance.

Paid $$50,525$ cash to reduce the long$-$term notes payable.

Issued $3,600$ shares of common stock for $$20$ cash per share.

Declared and paid cash dividends of $$52,300.$