Required Information Use the following information for the Problems below. (Algo) 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, and (4) all debits to Accounts Payable reflect cash payments for inventory FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales $637,500 Cost of goods sold 296,000 Gross profit 341,500 Operating expenses (excluding depreciation) $143,400 Depreciation expense 31,750 175, 150 Other gains (losses) Loss on sale of equipment (16,125) Income before taxes 150,225 Income taxes expense 39,650 Net incone $110,575 FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 66,400 82,380 292, 156 1,320 442, 256 146,500 (42,125) $546, 631 $ 84,500 61, 625 262,800 2,115 411, 040 119,000 (51,500) $478,548 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Conmon stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 64,141 13,300 77,441 59,500 136,941 $131, 175 8,200 139,375 59,750 199, 125 161,250 179, 250 54,000 176,440 $546,631 118,165 $478,540 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $16,125 (details in b). b. Sold equipment costing $79,875, with accumulated depreciation of $41,125, for $22,625 cash. c. Purchased equipment costing $107.375 by paying $52,000 cash and signing a long-term note payable for the balance. d. Borrowed $5,100 cash by signing a short-term note payable. e. Paid $55,625 cash to reduce the long-term notes payable. f. Issued 3,600 shares of common stock for $20 cash per share. 9. Declared and paid cash dividends of $52,300 Required information FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current assets and current liabilities ces Cash flows from investing activities Cash flows from financing activities: Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year
