[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 company's income statement and balance sheets follow. FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 $ 75,400 91,440 301,156 1,380 469,376 140,500 (45,125) $564,751 $ 90,500 67,625 268,800 2,235 429,160 125,000 (54,500) $499,660 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 Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 70,141 15,100 85,241 56,500 141,741 $140,175 9,400 149,575 65,750 215,325 167,250 196,750 54,500 171,760 $564,751 117,085 $499,660 Sales FORTEN COMPANY Income Statement For Year Ended December 31, 2017 $667,500 Cost of goods sold 302,000 Gross profit 365,500 Operating expenses Depreciation expense . $ 37,750 other expenses 149,400 187,150 other gains (losses) Loss on sale of equipment (22,125) Income before taxes 156,225 Income taxes expense 48,050 Net income $108,175 Problem 12-3A Indirect: Statement of cash flows LO A1, P1, P2, P3 Additional Information on Year 2017 Transactions a. The loss on the cash sale of equipment was $22,125 (details in 6). b. Sold equipment costing $97,875, with accumulated depreciation of $47,125, for $28,625 cash. c. Purchased equipment costing $113,375 by paying $64,000 cash and signing a long-term note payable for the balance. d. Borrowed $5,700 cash by signing a short-term note payable. e. Paid $58,625 cash to reduce the long-term notes payable f. Issued 4.200 shares of common stock for $20 cash per share. 9. Declared and paid cash dividends of $53,500 Required: 1. Prepare a complete statement of cash flows, report its operating activities using the indirect method (Amounts to be deducte should be indicated with a minus sian.) Required information FORTEN COMPANY Statement of Cash Flows For Year Ended December 31, 2017 Cash flows from operating activities Net income $ 108,175 Adjustments to reconcile net income to net cash provided by operations: Depreciation expense 37,750 Accounts receivable increase Inventory increase . Prepaid expense decrease Accounts payable decrease Loss on disposal of equipment 145,925 Net cash provided by operating activities Cash flows from investing activities Cash paid for equipment Cash received from sale of equipment Net cash used in investing activities Cash flows from financing activities: Cash borrowed on short-term note Cash received from issuing stock Cash paid on long-term note Cash paid for dividends Met er din financing artistin