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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		$ 602,500
Cost of goods sold		289,000
Gross profit		313,500
Operating expenses (excluding depreciation)	$ 136,400
Depreciation expense	24,750	161,150
Other gains (losses)
Loss on sale of equipment		(9,125)
Income before taxes		143,225
Income taxes expense		29,850
Net income		$ 113,375

FORTEN COMPANY
Comparative Balance Sheets
December 31
	Current Year	Prior Year
Assets
Cash	$ 55,900	$ 77,500
Accounts receivable	71,810	54,625
Inventory	281,656	255,800
Prepaid expenses	1,250	1,975
Total current assets	410,616	389,900
Equipment	153,500	112,000
Accumulated depreciationEquipment	(38,625)	(48,000)
Total assets	$ 525,491	$ 453,900
Liabilities and Equity
Accounts payable	$ 57,141	$ 120,675
Long-term notes payable	74,200	59,550
Total liabilities	131,341	180,225
Equity
Common stock, $5 par value	168,750	154,250
Paid-in capital in excess of par, common stock	43,500	0
Retained earnings	181,900	119,425
Total liabilities and equity	$ 525,491	$ 453,900

Additional Information on Current Year Transactions

1. The loss on the cash sale of equipment was $9,125 (details in b).
2. Sold equipment costing $58,875, with accumulated depreciation of $34,125, for $15,625 cash.
3. Purchased equipment costing $100,375 by paying $38,000 cash and signing a long-term notes payable for the balance.
4. Paid $47,725 cash to reduce the long-term notes payable.
5. Issued 2,900 shares of common stock for $20 cash per share.
6. Declared and paid cash dividends of $50,900.