80.2K

Verified Solution

Link Copied!

Required information Use the following information for the Problems below. (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. (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debited to Prepaid Expenses. FORTEN COMPANY Comparative Balance Sheets December 31 Current Year Prior Year $ 67,900 83,890 293,656 1,330 446,776 145,500 (42,625) $549,651 $ 85,500 62,625 263,800 2,135 414,060 120,000 (52,000) $482,060 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities 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 $ 65,141 13,600 78,741 59,000 137,741 $132,675 8,400 141,075 60, 750 201,825 180,750 55,500 175, 660 $549,651 162,250 0 117,985 $482,060 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold $642,500 297,000 AE EA 5642,500 297,000 345,500 FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cont of goods sold Gross profit Operating expenses Depreciation expense $ 32,750 Other expenses 146,400 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expensie Net income 177,150 (17,125) 151,225 41,050 $110.175 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 note payable for the balance. d. Borrowed $5,200 cash by signing a short-term note payable. e. Paid $56,125 cash to reduce the long-term notes payable. f. Issued 3,700 shares of common stock for $20 cash per share. 9. Declared and paid cash dividends of $52,500. Problem 12-4AA Indirect: Cash flows spreadsheet LO P4 Required: Prepare a complete statement of cash flows using a spreadsheet using the indirect method (Enter all amounts as positive values. FORTEN COMPANY Spreadsheet for Statement of Cash Flows For Current Year Ended December 31 Analysis of Changes Required information FORTEN COMPANY Spreadsheet for Statement of Cash Flows For Current Year Ended December 31 Analysis of Changes December 31, Prior Year Debit Credit December 31. Current Year $ $ 67,900 Balance sheet-debit Cash Accounts receivable Inventory Prepaid expenses Equipment 85,500 62,625 263,800 2,135 120,000 534,060 $ $ 67.900 $ Balance sheet-credit Accumulated depreciation Equipment Accounts payable Short-term notes payable Long-term notes payable Common stock, $5 par value Paid-in capital in excess of par value, common stock Retained earnings 52,000 132,675 8,400 60.750 162,250 0 117,985 534,060 $ $ 0 Statement of cash flows Operating activities Required information 162,250 Common stock, $5 par value Paid-in capital in excess of par value, common stock Retained earnings 0 117,985 534,060 $ $ 0 Statement of cash flows Operating activities es Investing activities Financing activities Non cash investing and financing activities Purchase of equipment financed by long-term note payable $ 0 $ 0

Answer & Explanation Solved by verified expert

See Answer