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 $ 647,500 298,000 349,500 $ 145,400 33,750 179,150 (18,125) Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income. 152,225 42,450 $ 109,775 Assets Cash Accounts receivable FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 69,400 85,400 $ 86,500 63.625 Check Assets Cash FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 69,400 85,400 295,156 $ 86,500 63,625 264,800 1,340 2,155 417,080 451,296 144,500 (43,125) $ 552,671 $ 66,141 121,000 (52,500) $ 485,580 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 a. The loss on the cash sale of equipment was $18,125 (details in b). $ 134,175 72,400 138,541 182,250 70,350 204,525 163,250 57,000 174,880 117,805 $ 552,671 $ 485,580 Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity ok k Additional Information on Current Year Transactions 138,541 204,525 182,250 163,250 57,000 e 174,880 117,805 $ 552,671 $ 485,580 a. The loss on the cash sale of equipment was $18,125 (details in b). b. Sold equipment costing $85,875, with accumulated depreciation of $43,125, for $24,625 cash. c. Purchased equipment costing $109,375 by paying $56,000 cash and signing a long-term notes payable for the balance. d. Paid $51,325 cash to reduce the long-term notes payable. e. Issued 3,800 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $52,700. 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. Note: Amounts to be deducted should be indicated with a minus sign. Cash flows from operating activities FORTEN COMPANY Statement of Cash Flows For Current Year Ended December 31 Adjustments to reconcile net income to net cash provided by operations Income statement items not affecting cash Changes in current assets and current liabilities For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations ok Income statement items not affecting cash k Changes in current assets and current liabilities Cash flows from investing activities Book Ask Required information Cash flows from investing activities Print Cash flows from financing activities: Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year