Required information

[The following information applies to the questions displayed below.] 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	$	64,900			$	83,500
Accounts receivable		80,870				60,625
Inventory		290,656				261,800
Prepaid expenses		1,310				2,095
Total current assets		437,736				408,020
Equipment		147,500				118,000
Accum. depreciationEquipment		(41,625	)			(51,000	)
Total assets	$	543,611			$	475,020
Liabilities and Equity
Accounts payable	$	63,141			$	129,675
Short-term notes payable		13,000				8,000
Total current liabilities		76,141				137,675
Long-term notes payable		60,000				58,750
Total liabilities		136,141				196,425
Equity
Common stock, $5 par value		182,750				160,250
Paid-in capital in excess of par, common stock		47,500				0
Retained earnings		177,220				118,345
Total liabilities and equity	$	543,611			$	475,020

FORTEN COMPANY Income Statement For Year Ended December 31, 2017
Sales				$	632,500
Cost of goods sold					295,000
Gross profit					337,500
Operating expenses
Depreciation expense	$	30,750
Other expenses		142,400			173,150
Other gains (losses)
Loss on sale of equipment					(15,125	)
Income before taxes					149,225
Income taxes expense					38,250
Net income				$	110,975

Additional Information on Year 2017 Transactions

a. Net income was $110,975.

b. Accounts receivable increased.

c. Inventory increased.

d. Prepaid expenses decreased.

e. Accounts payable decreased.

f. Depreciation expense was $30,750.

g. Sold equipment costing $76,875, with accumulated depreciation of $40,125, for $21,625 cash. This yielded a loss of $15,125.

h. Purchased equipment costing $106,375 by paying $50,000 cash and (i.) by signing a long-term note payable for the balance.

i. Borrowed $5,000 cash by signing a short-term note payable.

j. Paid $55,125 cash to reduce the long-term notes payable.

k. Issued 3,500 shares of common stock for $20 cash per share.

l. Declared and paid cash dividends of $52,100.

Required: Prepare a complete statement of cash flows using a spreadsheet; report its operating activities using the indirect method. (Enter all amounts as positive values.)

FORTEN COMPANY
Spreadsheet for Statement of Cash Flows
For Year Ended December 31, 2017
		Analysis of Changes
	December 31, 2016	Debit	Credit	December 31, 2017
Balance sheetdebit
Cash	$83,500			$64,900
Accounts receivable	60,625
Inventory	261,800
Prepaid expenses	2,095
Equipment	118,000
	$526,020
Balance sheetcredit
Accumulated depreciationEquipment	$51,000
Accounts payable	129,675
Short-term notes payable	8,000
Long-term notes payable	58,750
Common stock, $5 par value	160,250
Paid-in capital in excess of par value, common stock	0
Retained earnings	118,345
	$526,020
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