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Required information Use the following information for the Problems below. (Algo) (The following information applies to the questions displayed below.] 15 points 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. Book FORTEN COMPANY Income Statement Print For Current Year Ended December 31 Sales 662, 500 References Cost of goods sold 301, 060 Gross profit 361, 500 Operating expenses (excluding $ depreciation) 148, 400 Depreciation expense 36, 750 185, 150 Other gains (losses) Loss on sale of equipment (21, 125) Income before taxes 155, 225 Income taxes expense 46, 650 Net income 108, 575 FORTEN COMPANY Comparative Balance Sheets December 31 Current Prior Year Year Assets Cash $ 73, 900 89, 500 Accounts receivable 89, 930 66, 625 Inventory 299, 656 267, 800 Prepaid expenses 1,370 2, 215 Total current assets 464, 856 426, 140 Equipment 141, 500 124, 000 Accumulated depreciation-Equipment (44, 625) (54, 000) Total assets 561, 731 496, 140 Liabilities and Equity Accounts payable $ 69, 141 138 , 675 Long-term notes payable 71, 800 73, 950 Total liabilities 140, 941 212, 625 Equity Common stock, $5 par value 186, 750 166, 250 Paid-in capital in excess of par, 61, 500 common stock Retained earnings 172, 540 117, 265 Total liabilities and equity 561, 731 496, 140LUIIIIIIUNI SLUCK Retained earnings 172, 540 117, 265 Total liabilities and equity $ 561, 731 496, 140 15 points Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $21,125 (details in b). . Sold equipment costing $94,875, with accumulated depreciation of $46,125, for $27,625 cash. Book c. Purchased equipment costing $112,375 by paying $62,000 cash and signing a long-term notes payable for the balance. d. Paid $52,525 cash to reduce the long-term notes payable. Print . Issued 4,100 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $53,300. References 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. (Amounts to be deducted should be indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Net income 108,575 Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Depreciation expense 36,750 Loss on disposal of equipment 21.125 Changes in current assets and current liabilities Increase in accounts receivable increase in inventory Decrease in prepaid expenses Decrease in accounts payable $ 166,450 Cash flows from investing activities Cash paid for equipment Cash received from sale of equipment Cash flows from financing activities: Cash paid on long-term notes Cash received from issuing stock Cash paid for dividends Net increase (decrease) in cash 166,450 Cash balance at December 31, prior year Cash balance at December 31, current year $ 166,450