Required information [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. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) FORTEN COMPANY Income Statement For Current Year Ended December 31 Loss on sale of equipment Income before taxes Income taxes expense Net income Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets $ 142,400 30,750 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 $ 632,500 295,000 337,500 173,150 (15,125) 149,225 38,250 $ 110,975 Current Year $ 64,900 80,870 290,656 1,310 437,736 147,500 (41,625) $ 543,611 $ 63,141 73,000 136, 141 177,750 52,500 177,220 $ 543,611 Prior Year $ 83,500 60, 625 261,800 2,095 408,020 118,000 (51,000) $ 475,020 $ 129,675 66,750 196,425 160,250 0 118,345 $ 475,020
Required information [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. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Other gains (losses) FORTEN COMPANY Income Statement For Current Year Ended December 31 Loss on sale of equipment Income before taxes Income taxes expense Net income Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets $ 142,400 30,750 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 $ 632,500 295,000 337,500 173,150 (15,125) 149,225 38,250 $ 110,975 Current Year $ 64,900 80,870 290,656 1,310 437,736 147,500 (41,625) $ 543,611 $ 63,141 73,000 136, 141 177,750 52,500 177,220 $ 543,611 Prior Year $ 83,500 60, 625 261,800 2,095 408,020 118,000 (51,000) $ 475,020 $ 129,675 66,750 196,425 160,250 0 118,345 $ 475,020
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Please don't give image format
Transcribed Image Text:Required:
Prepare a complete statement of cash flows using the direct method.
Note: Amounts to be deducted should be indicated with a minus sign.
FORTEN COMPANY
Statement of Cash Flows
For Current Year Ended December 31
Cash flows from operating activities
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
![Required information
[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.
Sales
Cost of goods sold
Gross profit
Operating expenses (excluding depreciation)
Depreciation expense
Other gains (losses)
FORTEN COMPANY
Income Statement
For Current Year Ended December 31
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
$ 142,400
30,750
Additional Information on Current Year Transactions
$ 632,500
295,000
337,500
173,150
(15,125)
149,225
38,250
$ 110,975
Current Year
$ 64,900
80,870
290,656
1,310
437,736
147,500
(41,625)
$ 543,611
$63,141
73,000
136,141
d. Paid $50,125 cash to reduce the long-term notes payable.
e. Issued 3,500 shares of common stock for $20 cash per share.
f. Declared and paid cash dividends of $52,100.
177,750
52,500
177,220
$ 543,611
Prior Year
$ 83,500
60,625
261,800
2,095
408,020
118,000
(51,000)
$ 475,020
$ 129,675
66,750
196,425
160,250
0
118,345
$ 475,020
a. The loss on the cash sale of equipment was $15,125 (details in b).
b. Sold equipment costing $76,875, with accumulated depreciation of $40,125, for $21,625 cash.
c. Purchased equipment costing $106,375 by paying $50,000 cash and signing a long-term notes payable for the
balance.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4372ec4d-b133-43db-9782-a231351f841b%2F4d47f559-3e79-4ed3-8e13-3b450152c896%2F6ev4fv_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
[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.
Sales
Cost of goods sold
Gross profit
Operating expenses (excluding depreciation)
Depreciation expense
Other gains (losses)
FORTEN COMPANY
Income Statement
For Current Year Ended December 31
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
$ 142,400
30,750
Additional Information on Current Year Transactions
$ 632,500
295,000
337,500
173,150
(15,125)
149,225
38,250
$ 110,975
Current Year
$ 64,900
80,870
290,656
1,310
437,736
147,500
(41,625)
$ 543,611
$63,141
73,000
136,141
d. Paid $50,125 cash to reduce the long-term notes payable.
e. Issued 3,500 shares of common stock for $20 cash per share.
f. Declared and paid cash dividends of $52,100.
177,750
52,500
177,220
$ 543,611
Prior Year
$ 83,500
60,625
261,800
2,095
408,020
118,000
(51,000)
$ 475,020
$ 129,675
66,750
196,425
160,250
0
118,345
$ 475,020
a. The loss on the cash sale of equipment was $15,125 (details in b).
b. Sold equipment costing $76,875, with accumulated depreciation of $40,125, for $21,625 cash.
c. Purchased equipment costing $106,375 by paying $50,000 cash and signing a long-term notes payable for the
balance.
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