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. FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) $ 138,400 Depreciation expense Other gains (losses) $ 612,500 291,000 321,500 26,750 165,150 Loss on sale of equipment Income before taxes (11,125) 145,225 Income taxes expense Net income 32,650 $ 112,575 FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 58,900 74,830 $ 79,500 56,625 257,800 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable 284,656 1,270 2,015 419,656 395,940 151,500 114,000 (39,625) (49,000) $ 531,531 $ 460,940 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 Additional Information on Current Year Transactions $ 59,141 $ 123,675 73,800 132,941 61,950 185,625 171,750 156,250 46,500 0 180,340 119,065 $ 531,531 $ 460,940 a. The loss on the cash sale of equipment was $11,125 (details in b). b. Sold equipment costing $64,875, with accumulated depreciation of $36,125, for $17,625 cash. c. Purchased equipment costing $102,375 by paying $42,000 cash and signing a long-term notes payable for the balance. d. Paid $48,525 cash to reduce the long-term notes payable. e. Issued 3,100 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $51,300. Problem 12-3A (Algo) Indirect: Statement of cash flows LO A1, P2, P3 Required: 1. Prepare a complete statement of cash flows using the indirect method for the current year. Note: Amounts to be deducted should be indicated with a minus sign. Cash flows from operating activities FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current assets and current liabilities Cash flows from investing activities Cash flows from financing activities: Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year