Answer Happy

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. Sales Cost of goods sold Gross profit FORTEN COMPANY Income Statement For Current Year Ended December 31 Operating expenses (excluding depreciation) $ 144,400 32,750 Depreciation expense Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income Assets Cash Accounts receivable. Inventory Prepaid expenses Total current assets Total asseto FELIC FORTEN COMPANY Comparative Balance Sheets December 31 Equipment Accumulated depreciation Equipment $ 642,500 297,000 345,500 177,150 (17,125) 151,225 41,050 $ 110,175 Current Year Prior Year $ 67,900 83,890 293,656 1,330 446,776 145,500 (42,625) 6549,651 $ 85,500 62,625 263,800 2,135 414,060 120,000 (52,000) $482,060
Total current assato 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 earninga Total liabilities and equity d. Paid $50,925 cash to reduce the long-term notes payable. e. Issued 3,700 shares of common stock for $20 cash per share. f. Declared and paid cash dividends of $52,500. 446,//b 145,500 (42,625) $ 549,651 $ 65,141 72,600 137,741 Required: 4 DenmaIn 180,750 55,500 175,660 414,060 120,000 (52,000) $ 492,060 $ 132,675 69.150 201,825 162,250 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $17,125 (details in b). b. Sold equipment costing $82,875, with accumulated depreciation of $42,125, for $23,625 cash. c. Purchased equipment costing $108,375 by paying $54,000 cash and signing a long-term notes payable for the balance. Problem 16-3A (Algo) Indirect: Statement of cash flows LO A1, P2, P3 0 117,985 $ 549,651 $ 482,060 Ch
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.) 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 Cash flows from investing activities $ 0
Cash flows from investing activities Cash flows from financing activities: Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year $ $ $ 0 0 0 0 0
Balance sheet-debit Cash Accounts receivable Inventory Prepaid expenses Equipment Balance sheet-credit FORTEN COMPANY Spreadsheet for Statement of Cash Flows For Current Year Ended December 31 Accumulated depreciation-Equipment Accounts payable Long-term notes payable Common stock, $5 par value Paid-in capital in excess of par value, common stock Retained earnings December 31, Prior Year $ $ $ 85,500 62,625 263,800 2,135 120,000 534,060 52,000 132,675 69,150 162,250 0 117,985 AALLAAN. Analysis of Changes Debit Credit $ $ December 31, Current Year 67,900 67,900
Statement of cash flows Operating activities Investing activities. Financing activities S 534,060 $