Forten Company's current year income statement, comparative balance sheets, and additional information follow. For the year...

Transcribed Image Text:

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) $ 140,400 28,758 Depreciation expense Other gains (losses) Loss on sale of equipment Incone before taxes Income taxes expense Net income Assets Cash Accounts receivable Inventory FORTEN COMPANY Comparative Balance Sheets December 31 Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and terity Accounts payable Long-tere notes payable i Total Liabilities 622,500 293,000 329,500 169, 150 (13,125) 147,225 35,450 $ 111,775 Current Year Prior Year $61,900 $81,500 77,856 287,656 1,290 428,696 149,500 (40,625) $537.571 58,625 259,000 2,055 401,900 116,000 (50,000) $ 467,988 $61,141 $ 120,675 73,400 Madse 134.541 191.025 NO Net income 2 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets, Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable 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 W S #3 FORTEN COMPANY Comparative Balance Sheets December 31. 60 F3 E D $ d. Paid $49,325 cash to reduce the long-term notes payable. e. Issued 3,300 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $51,700. 4 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 sian. a a. The loss on the cash sale of equipment was $13,125 (details in b). b. Sold equipment costing $70,875, with accumulated depreciation of $38,125, for $19,625 cash. c. Purchased equipment costing $104,375 by paying $46,000 cash and signing a long-term notes payable for the balance. FA R F 5 T < Prev Saved G < (0 Current Year Prior Year $ 61,900 77,850 6 $ 111,775 287,656 1,290 428,696 140,500 (40,625) $ 537,571 Y 174,750 49,500 178,788 $ 537,571 $61,141 $ 126,675 73,400 64,350 134,541 191,025 158,250 118,705 $ 467,980 1 of 1 & V Rº $ 81,500 58,625 259,800 2,055 401,980 116,000. (50,000) 7 $ 467,988 H 8: Next > U 00 8 J Dil -0 ( K 28 O L Sign in C iz 26:13 1 ok Mc raw will Q A jakarenke de Required information Changes in current assets and current liabilities SUBME 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 @ 2 W S # 3 80 F E D 4 d: R LL F % 5 T < Prev G < (0 6 20 Saved 1 of 1 Y & 7 H 38 Next > U . 00 8 J Dil ( 9 K 8: O M Sign In | C... Quiz 3:26.16 Book Mc Graw Hill SUBMIT.... 3333333 Required information Cash flows from operating activities Module 2... Cash flows from investing activities 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 financing activities: Net increase (decrease) in cash Cengage... FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 < Prev M Question... Saved 1 of 1 + $622,500... Next > MOER-C..... 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) $ 140,400 28,758 Depreciation expense Other gains (losses) Loss on sale of equipment Incone before taxes Income taxes expense Net income Assets Cash Accounts receivable Inventory FORTEN COMPANY Comparative Balance Sheets December 31 Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and terity Accounts payable Long-tere notes payable i Total Liabilities 622,500 293,000 329,500 169, 150 (13,125) 147,225 35,450 $ 111,775 Current Year Prior Year $61,900 $81,500 77,856 287,656 1,290 428,696 149,500 (40,625) $537.571 58,625 259,000 2,055 401,900 116,000 (50,000) $ 467,988 $61,141 $ 120,675 73,400 Madse 134.541 191.025 NO Net income 2 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets, Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable 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 W S #3 FORTEN COMPANY Comparative Balance Sheets December 31. 60 F3 E D $ d. Paid $49,325 cash to reduce the long-term notes payable. e. Issued 3,300 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $51,700. 4 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 sian. a a. The loss on the cash sale of equipment was $13,125 (details in b). b. Sold equipment costing $70,875, with accumulated depreciation of $38,125, for $19,625 cash. c. Purchased equipment costing $104,375 by paying $46,000 cash and signing a long-term notes payable for the balance. FA R F 5 T < Prev Saved G < (0 Current Year Prior Year $ 61,900 77,850 6 $ 111,775 287,656 1,290 428,696 140,500 (40,625) $ 537,571 Y 174,750 49,500 178,788 $ 537,571 $61,141 $ 126,675 73,400 64,350 134,541 191,025 158,250 118,705 $ 467,980 1 of 1 & V Rº $ 81,500 58,625 259,800 2,055 401,980 116,000. (50,000) 7 $ 467,988 H 8: Next > U 00 8 J Dil -0 ( K 28 O L Sign in C iz 26:13 1 ok Mc raw will Q A jakarenke de Required information Changes in current assets and current liabilities SUBME 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 @ 2 W S # 3 80 F E D 4 d: R LL F % 5 T < Prev G < (0 6 20 Saved 1 of 1 Y & 7 H 38 Next > U . 00 8 J Dil ( 9 K 8: O M Sign In | C... Quiz 3:26.16 Book Mc Graw Hill SUBMIT.... 3333333 Required information Cash flows from operating activities Module 2... Cash flows from investing activities 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 financing activities: Net increase (decrease) in cash Cengage... FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 < Prev M Question... Saved 1 of 1 + $622,500... Next > MOER-C.....

Answer rating: 100% (QA)

FORTEN COMPANY Statement of Cash Flows For the Year Ended December 31 20XX Indirect Method ... View the full answer