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		$	52,900					$	75,500
Accounts receivable			68,810						52,625
Inventory			278,656						253,800
Prepaid expenses			1,270						1,995
Total current assets			401,636						383,920
Equipment			155,500						110,000
Accum. depreciationEquipment			(37,625	)					(47,000	)
Total assets		$	519,511					$	446,920
Liabilities and Equity
Accounts payable		$	55,141					$	117,675
Short-term notes payable			10,600						6,400
Total current liabilities			65,741						124,075
Long-term notes payable			64,000						50,750
Total liabilities			129,741						174,825
Equity
Common stock, $5 par value			165,750						152,250
Paid-in capital in excess of par, common stock			40,500						0
Retained earnings			183,520						119,845
Total liabilities and equity		$	519,511					$	446,920

FORTEN COMPANY Income Statement For Current Year Ended December 31
Sales				$	592,500
Cost of goods sold					287,000
Gross profit					305,500
Operating expenses
Depreciation expense	$	22,750
Other expenses		134,400			157,150
Other gains (losses)
Loss on sale of equipment					(7,125	)
Income before taxes					141,225
Income taxes expense					27,050
Net income				$	114,175

Additional Information on Current Year Transactions

1. The loss on the cash sale of equipment was $7,125 (details in b).
2. Sold equipment costing $52,875, with accumulated depreciation of $32,125, for $13,625 cash.
3. Purchased equipment costing $98,375 by paying $34,000 cash and signing a long-term note payable for the balance.
4. Borrowed $4,200 cash by signing a short-term note payable.
5. Paid $51,125 cash to reduce the long-term notes payable.
6. Issued 2,700 shares of common stock for $20 cash per share.
7. Declared and paid cash dividends of $50,500. Prepare a complete statement of cash flows using the indirect method for the current year