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.

FORTEN COMPANY

Comparative Balance Sheets

December 31Current YearPrior YearAssetsCash$67,900$85,500Accounts receivable83,89062,625Inventory293,656263,800Prepaid expenses1,3302,135Total current assets446,776414,060Equipment145,500120,000Accum. depreciationEquipment(42,625)(52,000)Total assets$549,651$482,060Liabilities and EquityAccounts payable$65,141$132,675Short-term notes payable13,6008,400Total current liabilities78,741141,075Long-term notes payable59,00060,750Total liabilities137,741201,825EquityCommon stock, $5 par value180,750162,250Paid-in capital in excess of par, common stock55,5000Retained earnings175,660117,985Total liabilities and equity$549,651$482,060

FORTEN COMPANY

Income Statement

For Current Year Ended December 31Sales$642,500Cost of goods sold297,000Gross profit345,500Operating expensesDepreciation expense$32,750Other expenses144,400177,150Other gains (losses)Loss on sale of equipment(17,125)Income before taxes151,225Income taxes expense41,050Net income$110,175

Additional Information on Current Year Transactions

1. The loss on the cash sale of equipment was $17,125 (details inb).
2. Sold equipment costing $82,875, with accumulated depreciation of $42,125, for $23,625 cash.
3. Purchased equipment costing $108,375 by paying $54,000 cash and signing a long-term note payable for the balance.
4. Borrowed $5,200 cash by signing a short-term note payable.
5. Paid $56,125 cash to reduce the long-term notes payable.
6. Issued 3,700 shares of common stock for $20 cash per share.
7. Declared and paid cash dividends of $52,500.

Problem 12-4AA Indirect: Cash flows spreadsheet LO P4

Required:

Prepare a complete statement of cash flows using a spreadsheet using theindirect method.

Can you show the debits and credits as well?

Required:

Prepare a complete statement of cash flows using thedirect method.(Amounts to be deducted should be indicated with a minus sign.)