Additional Information on Current Year Transactions

a$.$ The loss on the cash sale of equipment was $$5,125($details in $b).$

b$.$ Sold equipment costing $$46,875,$ with accumulated depreciation of $$30,125,$ for $$11,625$ cash.

c$.$ Purchased equipment costing $$96,375$ by paying $$30,000$ cash and signing a long$-$term notes payable for the balance.

d$.$ Paid $$46,125$ cash to reduce the long$-$term notes payable.

e$.$ Issued $2,500$ shares of common stock for $$20$ cash per share.

f$.$ Declared and paid cash dividends of $$50,100.$

Required:

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.

$\backslash$table$[[$FORTEN COMPANY$],[$Statement of Cash Flows$],[$For Current Year Ended December $31,],[$Cash flows from operating 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,$]]$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.

$\backslash$table$[[\backslash$table$[[$FORTEN COMPANY$],[$Income Statement$],[$For Current Year Ended December$]],31,,],[$Sales$,,,582,500],[$Cost of goods sold,,,$285,000],[$Gross profit,,,$297,500],[$Operating expenses $($excluding depreciation$),$$$132,400,,],[$Depreciation expense,$20,750,,153,150],[$Other gains $($losses$),,,],[$Loss on sale of equipment,,,$(5,125)$

Part $1$ of $3$

$20$

points

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References

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

a$.$ The loss on the cash sale of equipment was $$5,125($details in b$).$

b$.$ Sold equipment costing $$46,875,$ with accumulated depreciation of $$30,125,$ for $$11,625$ cash.

c$.$ Purchased equipment costing $$96,375$ by paying $$30,000$ cash and signing a long$-$term notes payable for the balance.

d$.$ Paid $$46,125$ cash to reduce the long$-$term notes payable.

e$.$ Issued $2,500$ shares of common stock for $$20$ cash per share.

f$.$ Declared and paid cash dividends of $$50,100.$

Required:

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.

FORTEN COMPANY

Statement of Cash Flows