Refer to the information reported about Forten Company in problem

FORTEN COMPANY Comparative Balance Sheets December 31, 2013 and 2012 2013 2012 Assets Cash $ 49,800 $ 73,500 Accounts receivable 65,810 50,625 Merchandise inventory 275,656 251,800 Prepaid expenses 1,250 1,875 Equipment 157,500 108,000 Accum. depreciationEquipment (36,625) (46,000) Total assets $ 513,391 $ 439,800 Liabilities and Equity Accounts payable $ 53,141 $ 114,675 Short-term notes payable 10,000 6,000 Long-term notes payable 65,000 48,750 Common stock, $5 par value 162,750 150,250 Paid-in capital in excess of par, common stock 37,500 0 Retained earnings 185,000 120,125 Total liabilities and equity $ 513,391 $ 439,800 FORTEN COMPANY Income Statement For Year Ended December 31, 2013 Sales $ 582,500 Cost of goods sold 285,000 Gross profit 297,500 Operating expenses Depreciation expense $ 20,750 Other expenses 132,400 153,150 Other gains (losses) Loss on sale of equipment (5,125) Income before taxes 139,225 Income taxes expense 24,250 Net income $ 114,975

Prepare a complete statement of cash flows using a spreadsheet as in Exhibit 16 4A.1; report its operating activities using the indirect method. Identify the debits and credits in the Analysis of Changes columns with letters that correspond to the following list of transactions and events

a. Net income was $ 114,975. b. Accounts receivable decreased. c. inventory increased. d. Prepaid expenses decreased. e. Accounts payable decreased. f. Depreciation expense was $ 20,750. g. Sold equipment costing $ 46,875, with accumulated depreciation of $ 30,125, for $11,625 cash. This yielded a loss of $ 5,125. h. Purchased equipment costing $ 96,375 by paying $ 30,000 cash and (i.) by signing a long- term note payable for the balance. j. Borrowed $ 4,000 cash by signing a short- term note payable. k. Paid $ 50,125 cash to reduce the long- term notes payable. l. Issued 2,500 shares of common stock for $ 20 cash per share.

m. Declared and paid cash dividends of $50,100