Required information

Forten Company, a merchandiser, recently completed its calendar-year 2017 operations. 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. The companys income statement and balance sheets follow.

FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016
	2017				2016
Assets
Cash	$	73,900			$	89,500
Accounts receivable		89,930				66,625
Inventory		299,656				267,800
Prepaid expenses		1,370				2,215
Total current assets		464,856				426,140
Equipment		141,500				124,000
Accum. depreciationEquipment		(44,625	)			(54,000	)
Total assets	$	561,731			$	496,140
Liabilities and Equity
Accounts payable	$	69,141			$	138,675
Short-term notes payable		14,800				9,200
Total current liabilities		83,941				147,875
Long-term notes payable		57,000				64,750
Total liabilities		140,941				212,625
Equity
Common stock, $5 par value		194,750				166,250
Paid-in capital in excess of par, common stock		53,500				0
Retained earnings		172,540				117,265
Total liabilities and equity	$	561,731			$	496,140

FORTEN COMPANY Income Statement For Year Ended December 31, 2017
Sales				$	662,500
Cost of goods sold					301,000
Gross profit					361,500
Operating expenses
Depreciation expense	$	36,750
Other expenses		148,400			185,150
Other gains (losses)
Loss on sale of equipment					(21,125	)
Income before taxes					155,225
Income taxes expense					46,650
Net income				$	108,575

Additional Information on Year 2017 Transactions

The loss on the cash sale of equipment was $21,125 (details in b).

Sold equipment costing $94,875, with accumulated depreciation of $46,125, for $27,625 cash.

Purchased equipment costing $112,375 by paying $62,000 cash and signing a long-term note payable for the balance.

Borrowed $5,600 cash by signing a short-term note payable.

Paid $58,125 cash to reduce the long-term notes payable.

Issued 4,100 shares of common stock for $20 cash per share.

Declared and paid cash dividends of $53,300.

Required: 1. Prepare a complete statement of cash flows; report its operating activities using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

4 Required information Forten Company, a merchandiser, recently completed its calendar-year 2017 operations. 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. The company's income statement and balance sheets follow 0/4 points awarded FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016 Scored 2017 2016 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets $ 73,900 89,500 66,625 267,800 2,215 426,140 124,000 89,930 299,656 1,370 464,856 141,500 eBook (44,625) (54,000) Ask $561,731 $496,140 Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total 1iabilities and equity $ 69,141 $138,675 9,200 147,875 64,750 212,625 14,800 83,941 57,000 140,9451 Print Reterences 166,250 117,265 $561,731 $496,140 194,750 53,500 172,540 FORTEN COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses $662,500 361,500 Depreciation expense S 36,750 Other expenses Other gains (losses) 148,400 185,150 Loss on sale of equipment Income before taxes Income taxes expense Net income 21,125 155,22!5 46,650 $108,575 Additional Information on Year 2017 Transactions a. The loss on the cash sale of equipment was $21,125 (details in b) b. Sold equipment costing $94,875, with accumulated depreciation of $46,125, for $27,625 cash c. Purchased equipment costing $112,375 by paying $62,000 cash and signing a long-term note payable for the balance d. Borrowed $5,600 cash by signing a short-term note payable e. Paid $58,125 cash to reduce the long-term notes payable f. Issued 4,100 shares of common stock for $20 cash per share g. Declared and paid cash dividends of $53,300