Problem 12-1A Req. 1 Solution Part 1 FORTEN COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities: $114,975 Increase in accounts receivable ($65,810-$50 (15,185) Increase in inventory ($275,656-$251,800(23,856) Decrease in prepaid expenses ($1,875-$1,250) 625 Decrease in accounts payable ($114,675-$53,141)(61,534) Depreciation expense.. Loss on disposal of equipment.... Net cash provided by operating activities. 20,750 5,125 s 40,900 Cash flows from investing activities Cash received from sale of equipment.. Cash paid for equipment. Net cash used in investing activities. 11,625 30,000) (18,375) Cash flows from financing activities Cash borrowed on short-term note.4,000 Cash paid on long-term note.(50,125) Cash received from issuing stock (2,500 x $20)50,000 Cash paid for dividends Net cash used in financing activities (50,100) Net decrease in cash..nno Cash balance at December 31, 2012. Cash balance at December 31, 2013.. (46,225) $(23,700) 73,500 $49,800 Noncash investing and financing activitie Purchased equipment for $96,375 by signing a $66,375 long-term note payable and paying $30,000 in cash