SEU Forten COs Current Year Income Statement & Comparative Balance Sheets Excel Task

DescriptionProblem 12 – 3A:
Forten Company’s current year income statement, comparative balance sheets, and additional information follow.
For the year, all sales or credit sales, all credits to Accounts Receivable reflect cash receipts from customers,
All purchases of inventory are on credit, all debits to Accounts Payable reflect cash payments
For inventory, and Other Expenses are paid in advance and are initially debited to prepaid expenses.
Forten Company
Income Statement
For the Year Ended December 31, 2020
Sales
Cost of goods sold
Gross profit
$
Operating Expenses:
Depreciation expense
Other expenses
Other gains/(losses):
Loss on sale of equipment
Income before taxes
Income taxes expense
Net income
$
20,750
132,400
582,500
285,000
297,500
153,150
$
(5,125)
139,225
24,250
114,975
Forten Company
Balance Sheet
As of December 31, 2019 and 2020
Assets
Cash
Accounts receivable
Inventory
Prepaid expenses
Total current assets
Equipment
Accumulated depreciation – Equipment
Total assets
Liabilities and Equity
Accounts payable
Short-term notes payable
Total current liabilities
Long-term notes payable
Total liabiities
$
$
$
2020
2019
49,800 $
65,810
275,656
1,250
392,516
157,500
(36,625)
513,391 $
73,500
50,625
251,800
1,875
377,800
108,000
(46,000)
439,800
53,141 $
10,000
63,141
65,000
128,141
114,675
6,000
120,675
48,750
169,425
Equity
Common stock, $5 par value
Paid-in-captial in excess of par, common stock
Retained earnings
Total Equity
Total liabilities and equity
Additional information:
a. Loss on the cash sale of equipment
b. Sold equipment costing
Accumulated depreciation on equipment sold
Cash received for sale of equipment
c. Purchase price of equipment
Cash paid for equipment
Long-term note payable for equipment purchase
d. Borrowed cash by signing a short-term note payable
e. Cash paid to reduce the long-term notes payable
f. Issued $2500 that shares of common stock for $20 per share
g. Declared and paid cash dividends
162,750
37,500
185,000
385,250
150,250
120,125
270,375
$
513,391 $
439,800
$
5,125
46,875
30,125
11,625
96,375
30,000
66,375
4,000
50,125
50,100
Part 1: Prepare a complete statement of cash flows using the indirect method for the current year.
Disclose any non-cash investing and financing activities in a note to the financial statements.
Make sure that you prepare the statement in good form.
Part 2: Analyze and discuss the statement of cash flows prepared in Part 1,
Giving special attention to the wisdom of the cash dividend payment.
You should place that commentary within this document below here. This should be about a paragraph in length
onal information follow.

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