Required information Use the following information for the Problems 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 2816 Assets Cash S 64,980$83,500 80,870 980 $83,500 Accounts receivable Inventory Prepaid expenses Total current assets 98,656261,888 2,895 408,020 118,000 (41,625)51,00) $543,611 475,020 437,736 147,500 Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilitles Long-term notes payable 63,141 $ 129,675 8,000 137,675 58.750 13,000 6,141 60,000 a. The loss on the cash sale of equipment was $15,125 (details in b b. Sold equipment costing $76,875, with accumulated depreciation of $40,125, for $21,625 cash. c. Purchased equipment costing $106,375 by paying $50,000 cash and signing a long-term note payable for the balanc d. Borrowed $5,000 cash by signing a short-term note payable. e. Paid $55,125 cash to reduce the long-term notes payable. f. Issued 3,500 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $52,100 Problem 16-5AB Direct: Statement of cash flows LO P1, P3, P5 Required: Prepare a complete statement of cash flows, report its operating activities according to the direct method (Amounts to be dedu should be indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Year Ended December 31, 2017 Cash flows from operating activities a. The loss on the cash sale of equipment was $15,125 (details in b b. Sold equipment costing $76,875, with accumulated depreciation of $40,125, for $21,625 cash. c. Purchased equipment costing $106,375 by paying $50,000 cash and signing a long-term note payable for the balanc d. Borrowed $5,000 cash by signing a short-term note payable. e. Paid $55,125 cash to reduce the long-term notes payable. f. Issued 3,500 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $52,100 Problem 16-5AB Direct: Statement of cash flows LO P1, P3, P5 Required: Prepare a complete statement of cash flows, report its operating activities according to the direct method (Amounts to be dedu should be indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Year Ended December 31, 2017 Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Net increase (decrease) in cash Cash balance at beginning of year Cash balance at end of year
