opedDokHInt0ence[The following information applies to the questions displayed below]Forten Company's current year Income statement, comparative balance sheets, and additional Informationfollow. For the year. (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receiptsfrom customers, (3) all purchases of Inventory are on credit, and (4) all debits to Accounts Payable reflectSenscash payments for Inventory.FORTEN COMPANYIncome StatementFor Current Year Ended December 31SalesCost of goods soldGross profitOperating expenses (excludingdepreciation)Depreciation expenseOther gains (losses)Loss on sale of equipmentIncome before taxesIncome taxes expenseNet incomeAssetsCashFORTEN COMPANYComparative Balance SheetsDecember 31Accounts receivableInventoryPrepaid expensesTotal current assetsEquipmentAccumulated depreciation-EquipmentTotal assetsLiabilities and EquityAccounts payableLong-term notes payableTotal liabilitiesEquityCommon stock, $5 par valuePaid-in capital in excess of par,common stockRetained earningsTotal liabilities and equity$146,40034,758FORTEN COMPANYStatement of Cash FlowsCash flows from operating activitiesAdjustments to reconcile net income to net cashprovided by operations:Income statement items not affecting cashMOTULININChanges in current assets and current liabilitiesCash flows from investing activitiesCash flows from financing activities:$652,500299,000353,500Net increase (decrease) in cashCash balance at December 31, prior yearCash balance at December 31, current year181, 150(19,125)153,22543,850For Current Year Ended December 31$109,375CurrentYear$70,90086,910296,656 265, 8001,3502,175455,816 420,100143,500 122,000(43,625) (53,000)$$555,691 489, 100PriorYear$ 67,14172,200139,341 207,225$555,691Additional Information on Current Year Transactionsa. The loss on the cash sale of equipment was $19,125 (details in b)b. Sold equipment costing $88,875, with accumulated depreciation of $44,125, for $25,625 cash.c. Purchased equipment costing $110,375 by paying $58,000 cash and signing a long-term notes payablefor the balance.d. Paid $51,725 cash to reduce the long-term notes payable.e. Issued 3,900 shares of common stock for $20 cash per share.1. Declared and paid cash dividends of $52,900.$87,50064,625Required:1. Prepare a complete statement of cash flows using the indirect method for the current year, (Amounts to be deductedshould be Indicated with a minus sign.)$135,67571,550183,750 164,25058,500174,100 117,625$489, 100$0$0000< Prev7 of 7Next

Cash Flow Statement : It is the statement of cash inflows and outflows from the three cash generated…

Answered: 1 $ 652,500 299,000 353,500 181, 150…

Business

Accounting

1 $ 652,500 299,000 353,500 181, 150 (19,125) 153, 225 43,850 $ 109,375

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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