Question

I need help with the cash flow spreadsheet for the debit and credit changes. Thank you.

Use the following information for the Problems below. Forten Company, a merchandiser, recently completed its calendar-year 2017 operations. 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. The company's income statement and balance sheets follow. FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 $ 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 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 $ 53,141 10,000 63,141 65,000 128, 141 $ 114,675 6,000 120,675 48,750 169,425 150, 250 162,750 37,500 185,000 $ 513,391 120, 125 $ 439,800 $ 582,500 285,000 297,500 FORTEN COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 20,750 Other expenses 132,400 Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income 153, 150 (5,125) 139, 225 24,250 $ 114,975 Additional Information on Year 2017 Transactions a. The loss on the cash sale of equipment was $5,125 (details in b). b. Sold equipment costing $46,875, with accumulated depreciation of $30,125, for $11,625 cash. c. Purchased equipment costing $96,375 by paying $30,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,000 cash by signing a short-term note payable. e. Paid $50,125 cash to reduce the long-term notes payable. f. Issued 2,500 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $50,100.

Answer 1

Forten Company
Cashflow Indirect Statement
		Analysis of Changes
Balance sheet-Debit balance accounts	31-Dec-14	Debit	Credit	31-Dec-15
Cash	73,500			49,800
Accounts Receivable	50,625	15,185		65,810
Inventory	251,800	23,856		275,656
Prepaid Expenses	1,875		625	1,250
Equipment	108,000	96,375	46,875	157,500
	485,800			550,016
Balance sheet-Credit balance accounts
Accumulated Depreciation-Equipment	46,000	30,125	20,750	36,625
Accounts Payable	114,675	61,534		53,141
Short term Notes Payable	6,000		4,000	10,000
Long term Notes Payable	48,750	50,125	66,375	65,000
Common Stock, %5 par value	150,250		12,500	162,750
Paid in capital in excess of par value, CS	-		37,500	37,500
Retained Earnings	120,125	50,100	114,975	185,000
	485,800			550,016
Statement of Cashflows	-			-
Operating Activities
Net income		114,975
Increase in Accounts Receivable			15,185
Increase in Inventory			23,856
Decrease in Prepaid Expenses		625
Decrease in Accounts Payable			61,534
Depreciation expense		20,750
Loss on sale of equipment		5,125
Investing Activities
Receipt from sale of equipment		11,625
Payment to purchase equipment			30,000
Financing Activities
Borrowed on short term		4,000
Payment on long term			50,125
Issued common stock for cash		50,000
Payment of cash Dividends			50,100
Non cash investing and financing activitites
Purchase of equipment financed by long term note payable		66,375	66,375	=96,375-30,000
		600,775	600,775