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 31 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets. Current Year Prior Year $ 57,400 73,320 283,156 $ 78,500 55,625 256,800 1,260 1,995 415,136 392,920 Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity: Accounts payable Short-term notes payable Total current liabilities Long-term notes payable. Total liabilities Equity 152,500 113,000 (39,125) (48,500) $528,511 $457,420 $ 58,141 $122,175 11,500 7,000 69,641 129,175 62,500 53,750 132,141 182,925 Common stock, $5 par value. 170,250 155,250 Paid-in capital in excess of par, common stock 45,000 0 Retained earnings Total liabilities and equity. 181,120 $528,511 119,245 $457,420 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales $607,500 Cost of goods sold 290,000 Gross profit 317,500 Operating expenses Depreciation expense Other expenses $ 25,750 137,400 163,150 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales $607,500 Cost of goods sold 290,000 Gross profit 317,500 Operating expenses Depreciation expense $ 25,750 Other expenses 137,400 163,150 Other gains (losses). Loss on sale of equipment (10,125) Income before taxes 144,225 Income taxes expense Net income 31,250 $112,975 Help Save & Exit Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $10,125 (details in b). b. Sold equipment costing $61,875, with accumulated depreciation of $35,125, for $16,625 cash. c. Purchased equipment costing $101,375 by paying $40,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,500 cash by signing a short-term note payable. e. Paid $52,625 cash to reduce the long-term notes payable. f. Issued 3,000 shares of common stick for $20 cash per share. g. Declared and paid cash dividends of $51,100. Required: 1. Prepare a complete statement of cash flows using the indirect method for the current year. (Amounts to be deducted shoulm indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Collapse L 100 information 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: $ Cash flows from investing activities Cash flows from financing activities: 0 0 $ Net increase (decrease) in cash