Required information

Use the following information for the Problems below.

[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	$	66,400			$	84,500
Accounts receivable		82,380				61,625
Inventory		292,156				262,800
Prepaid expenses		1,320				2,115
Total current assets		442,256				411,040
Equipment		146,500				119,000
Accum. depreciationEquipment		(42,125	)			(51,500	)
Total assets	$	546,631			$	478,540
Liabilities and Equity
Accounts payable	$	64,141			$	131,175
Short-term notes payable		13,300				8,200
Total current liabilities		77,441				139,375
Long-term notes payable		59,500				59,750
Total liabilities		136,941				199,125
Equity
Common stock, $5 par value		184,750				161,250
Paid-in capital in excess of par, common stock		48,500				0
Retained earnings		176,440				118,165
Total liabilities and equity	$	546,631			$	478,540

FORTEN COMPANY Income Statement For Year Ended December 31, 2017
Sales				$	637,500
Cost of goods sold					296,000
Gross profit					341,500
Operating expenses
Depreciation expense	$	31,750
Other expenses		143,400			175,150
Other gains (losses)
Loss on sale of equipment					(16,125	)
Income before taxes					150,225
Income taxes expense					39,650
Net income				$	110,575

Problem 12-3A Indirect: Statement of cash flows LO A1, P1, P2, P3

Additional Information on Year 2017 Transactions

The loss on the cash sale of equipment was $16,125 (details in b).

Sold equipment costing $79,875, with accumulated depreciation of $41,125, for $22,625 cash.

Purchased equipment costing $107,375 by paying $52,000 cash and signing a long-term note payable for the balance.

Borrowed $5,100 cash by signing a short-term note payable.

Paid $55,625 cash to reduce the long-term notes payable.

Issued 3,600 shares of common stock for $20 cash per share.

Declared and paid cash dividends of $52,300.

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.)

FORTEN COMPANY
Statement of Cash Flows
For Year Ended December 31, 2017
Cash flows from operating activities
Adjustments to reconcile net income to net cash provided by operations:
		$0
Cash flows from investing activities
		0
Cash flows from financing activities:
		0
Net increase (decrease) in cash		$0
Cash balance at beginning of year
Cash balance at end of year		$0