I need help with the red x's on the first image, plz explain.

Forten Comparty's current year Income statement, comparative balance sheets, and additional information follow. For the year, (i) all sales are credit sales. ) all credits to Accounts Receivable reflect cash receipts from customers, @) all purchases of Inventory are on credit. (4) all debits to Accounts Payable reflect cash payments for Irwentory, and (5) Other Expenses are paid in advance and are Initially debited to Prepaid Expenses. FORTEN COMPANY Comparative Balance Sheets December 31 Prior Year 49,888 65,810 275,656 1 25e 392,516 157, 580 (36,625) $ 513,391 73,589 5e, 625 251,820 1,875 377,880 188,899 (46,698) $ 439,8ee Accounts receivable Inventory Prepaid expenses Total current assets 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 Common stock, $5 par value Pald-in capital in excess of part, common Retained earnings Total liabilities and equity 141 $ 114,675 16.eee 120,675 48.75e 169 425 1002se 5439.00 Sales 592902 29.se FORTEN COMPANY Income statement Current Year Ended December 31 Cost of goods sold Gross profit Operating expenses DeLon exces Other expen Other geins losses LOSSOS Income before taxes Eric L es experi 2.4be 153 15 2.39 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $5.125 (details in b. Sold equipment costing $46,875, with accumulated depreciation of $30,125, for $11.625 cash. c Purchased equipment costing $96,376 by paying $30,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,000 cash by signing a short-term note payable. e. Pald $50,125 cash to reduce the long-term notes payable. t.issued 2.500 shares of common stock for $20 cash per share. 9. Declared and paid cash dividends of $50,100. Required: Prepare a complete statement of cash flows using the direct method. (Amounts to be deducted should be indicated with a minus sign.) Answer is not complete. FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Loss on sale of equipment Depreciation expense Depreciation expense Decrease in accounts payable Net cash provided by operating activities Cash flows from investing activities Cash received from sale of equipment Cash paid for equipment 11025 (30.000) OS 18.375 Net cash used in investing activities Cash flows from financing av Cash received from issuing stock Cash paid for dividends Cash borrowed on short-term ne Cash paid on long-term note 60.000 50.100 14.000 (50 1260 Netcash used in financing activities