th 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, (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. FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year Assets Cash $ 57,400 $ 78,500 Accounts receivable 73,320 55,625 Inventory 283, 156 256,800 Prepaid expenses 1,260 1,995 Total current assets 415,136 392,920 Equipment 152,500 113,000 Accum. depreciation-Equipment (39,125 (48,500) Total assets $ 528,511 $ 457,420 Liabilities and Equity Accounts payable $ 58,141 $ 122,175 Short-term notes payable 11,500 7,000 Total current liabilities 69,641 129,175 Long-term notes payable 62,500 53,750 Total liabilities 132, 141 182,925 Equity Common stock, $5 par value 170,250 155, 250 Paid-in capital in excess of par, common stock 45,000 e Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity 170,250 45,000 181,120 $ 528,511 155, 250 8 119,245 $ 457,420 $ 607,500 290,000 317,500 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 25,750 Other expenses 137,400 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 163, 150 (10, 125) 144, 225 31,250 $ 112,975 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $10,125 (details in b). b. Sold equipment costing $61,875, with accumulated depreciation of $35,125, for $16,625 cash. c. Purchased equipment costing $101,375 by paying $40,000 cash and signing a long-term note payable for the d. Borrowed $4,500 cash by signing a short-term note payable. e. Paid $52,625 cash to reduce the long-term notes payable. f. Issued 3,000 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $51,100. balance. Required: 1. Prepare a complete statement of cash flows using the indirect method for the current year. (Amounts to be deducted sh indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities