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 company's income statement and balance sheets follow. FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets $ 51,400 $ 74,500 51,625 252,800 2,025 380,950 109,000 37,125) (46,50e) $516,541 443,450 67,310 277,156 1,300 397,166 156, 500 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 liabilities and equity $ 54,141 116,175 6,200 122,375 49,750 172,125 , 64,441 64,500 128,941 164,750 38,500 184,350 151,250 120,075 $516,541 443,450 FORTEN COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses $ 587,50e 286,000 301,58e $ 21,75e 133,400 Depreciation expense 155,15e Other expenses Other gains (losses) Loss on sale of equipment (6,125) Income before taxes Income taxes expense Net income 140,225 25,650 $114,575 Additional Information on Year 2017 Transactions a. Net income was $114,575. : b. Accounts receivable increased c. Inventory increased. d. Prepaid expenses decreased. e. Accounts payable decreased. f. Depreciation expense was $21,750 g. Sold equipment costing $49,875, with accumulated depreciation of $31,125, for $12,625 cash. This yielded a loss of $6,125. h. Purchased equipment costing $97,375 by paying $32,000 cash and (i.) by signing a long-term note payable for the balance i. Borrowed $4,100 cash by signing a short-term note payable. .Paid $50,625 cash to reduce the long-term notes payable k. Issued 2,600 shares of common stock for $20 cash per share . Declared and paid cash dividends of $50,300. 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 Debit December 31, 2016 Credit December 31, 2017 alance sheet- debit 51,400 Cash Accounts receivable Inventory Prepaid expenses Equipment 74,500 51,625 252,800 2,025 109,000 489,950 51,400 Balance sheet credit Accumulated depreciation-Equipment Accounts payable Short-term notes payable Long-term notes payable Common stock, $5 par value Paid-in capital in excess of par value, common stock Retained eamings 46,500 116,175 6.200 49,750 151,250 120,075 489,950 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 0 S
