Required information [The following information applies to the questions displayed below.) 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. Prior Year FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Assets Cash $ 73,900 Accounts receivable 89,930 Inventory 299,656 Prepaid expenses 1,370 Total current assets 464,856 Equipment 141,500 Accum. depreciation-Equipment (44,625 ) Total assets $561,731 Liabilities and Equity Accounts payable $ 69,141 Short-term notes payable 14,800 Total current liabilities 83,941 Long-term notes payable 57,000 Total liabilities 140, 941 Equity Common stock, $5 par value 186,750 Paid-in capital in excess of par, 61,500 common stock Retained earnings 172,540 Total liabilities and equity $561,731 $ 89,500 66,625 267,800 2,215 426,140 124,000 (54,000). $496,140 $ 138,675 9,200 147,875 64,750 212,625 166,250 0 $561,731 $496,140 117,265 $ 496,140 FORTEN COMPANY Income Statement For Current Year Ended December 31 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 (21,125) equipment Income before taxes 155, 225 Income taxes expense 46,650 Net income $108,575 Additional Information on Current Year 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. Required: Required: Prepare a complete statement of cash flows using a spreadsheet using the indirect method. (Enter all amounts as positive values.) December 31, Current Year $ 73,900 FORTEN COMPANY Spreadsheet for Statement of Cash Flows For Current Year Ended December 31 Analysis of Changes December 31, Debit Credit Prior Year Balance sheet-debit Cash $ 89,500 Accounts receivable 66,625 Inventory 267,800 Prepaid expenses 2,215 Equipment 124,000 $ 550,140 Balance sheet-credit | Accumulated depreciation-Equipment | $ 54,000 Accounts payable 138,6757 Short-term notes payable 9.200 Long-term notes payable 64,750 Common stock, $5 par value 166,250 Paid-in capital in excess of par value, common stock Retained earnings 117,265 550,140 Statement of cash flows Operating activities Investing activities Financing activities Non cash investing and financing activities Purchase of equipment financed by long- term note payable
