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. $ 672,500 303,000 369,500 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) $ 150,400 Depreciation expense 38,750 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 189, 150 (23, 125) 157, 225 49,450 $ 107,775 FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 76,900 92,950 302,656 1,390 473, 896 139,500 (45, 625) $ 567,771 $ 91,500 66,625 269,800 2,255 432,180 126,000 (55,000) $ 503,180 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earning- Total liabilities and equity $ 71,141 71,400 142, 541 $ 141, 675 76, 350 216,025 168,250 189,750 64,500 170, 980 $ 567,771 116,905 $ 503,180 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $23,125 (details in b). b. Sold equipment costing $100,875, with accumulated depreciation of $48,125, for $29,625 cash. c. Purchased equipment costing $114,375 by paying $66,000 cash and signing a long-term notes payable for the balance. d. Paid $53,325 cash to reduce the long-term notes payable. e. Issued 4,300 shares of common stock for $20 cash per share. f. Declared and pald cash dividends of $53,700. Required: 1. Prepare a complete statement of cash flows using the Indirect method for the current year. (Amounts to be deducted should be indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Depreciation expense Loss on disposal of equipment Changes in current assets and current liabilities Increase in accounts receivable Increase in inventory Decrease in prepaid expenses Decrease in accounts payable S 0 Cash flows from investing activities Cash received from sale of equipment Cash paid for equipment 0 Cash flows from financing activities: Cash received from issuing stock Cash paid for dividends Cash paid on long-term notes 0 S 0 Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year S 0