Required information 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 Sales Cost of goods sold Gross profit For Current Year Ended December 31 $ 592,500 287,000 305,500 $ 134,400 22,750 157,150 (7,125) Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 141,225 27,050 $ 114,175 Assets Cash Accounts receivable Inventory FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 52,900 68,810 278,656 1 370 $ 75,500 52,625 253,800 1