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
	Current Year						Prior Year
Assets
Cash		$	55,900					$	77,500
Accounts receivable			71,810						54,625
Inventory			281,656						255,800
Prepaid expenses			1,250						1,975
Total current assets			410,616						389,900
Equipment			153,500						112,000
Accum. depreciationEquipment			(38,625	)					(48,000	)
Total assets		$	525,491					$	453,900
Liabilities and Equity
Accounts payable		$	57,141					$	120,675
Short-term notes payable			11,200						6,800
Total current liabilities			68,341						127,475
Long-term notes payable			63,000						52,750
Total liabilities			131,341						180,225
Equity
Common stock, $5 par value			168,750						154,250
Paid-in capital in excess of par, common stock			43,500						0
Retained earnings			181,900						119,425
Total liabilities and equity		$	525,491					$	453,900

FORTEN COMPANY Income Statement For Current Year Ended December 31
Sales				$	602,500
Cost of goods sold					289,000
Gross profit					313,500
Operating expenses
Depreciation expense	$	24,750
Other expenses		136,400			161,150
Other gains (losses)
Loss on sale of equipment					(9,125	)
Income before taxes					143,225
Income taxes expense					29,850
Net income				$	113,375

Additional Information on Current Year Transactions

1. The loss on the cash sale of equipment was $9,125 (details in b).
2. Sold equipment costing $58,875, with accumulated depreciation of $34,125, for $15,625 cash.
3. Purchased equipment costing $100,375 by paying $38,000 cash and signing a long-term note payable for the balance.
4. Borrowed $4,400 cash by signing a short-term note payable.
5. Paid $52,125 cash to reduce the long-term notes payable.
6. Issued 2,900 shares of common stock for $20 cash per share.
7. Declared and paid cash dividends of $50,900.