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 For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) $ 145,400 33,750 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 FORTEN COMPANY Comparative Balance Sheets December 31 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 $ 647,500 298,000 349,500 179,150 (18,125) 152,225 42,450 $ 109,775 Current Year Prior Year Required: Prepare a complete statement of cash flows using the direct method. $69,400 85,400 295,156 1,340 451,296 144,500 (43,125) $ 552,671 $ 66,141 72,400 138,541 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. 182,250 57,000 174,880 $ 552,671 Problem 16-5AB (Algo) Direct: Statement of cash flows LO P5 $ 86,500 63,625 264,800 2,155 417,080 121,000 (52,500) $ 485,580 $ 134,175 70,350 204,525 163,250 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. 0 117,805 $ 485,580