help to answer it and Explain ProBlem 12-3A Indirect: Statement of cash flows LO

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help to answer it and Explain

ProBlem 12-3A Indirect: Statement of cash flows LO A1, P1, P2, P3 Additional Informetion on Year 2017 Transactions a. The loss on the cash sale of equipment was $17,125 (detals in tj b. Sold equipment costing $82.875, with accumulated depreciation of $42125, for $23,625 cash 148.03 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. g. Declared and paid cash dividends of $52,500 Required: 1. Prepare a complete statement of cash flows; report its operating activities using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) FORTEN COMPANY Statement of Cash Flows For Year Ended December 31, 2017 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations Cash flows from investing activities

Explanation / Answer

Statement of Cash Flows AS ON DECEMBER 31 2017 Amount in $ Amount in $ Net income $          1,10,175 Cash flows from operating activities Adjustments for: Depreciation $             32,750 Loss on sale of Equipment $             17,125 (Increase) / Decrease in Account receivables $            -21,265 Inventory Decrease / (Increase) $            -29,856 Prepaid Expenses $                   805 Accounts payable Increase / ( Decrese) $            -67,534 $            -67,975 Net cash from operating activities $             42,200 Cash flows from investing activities Sale of Equipment $             23,625 Purchase of Equipment $            -54,000 Net cash used in investing activities $            -30,375 Cash flows from Financing activities Issue of Common Stock $             74,000 Retirement of Long Term Note Payable $            -56,125 Dividend Paid $            -52,500 Short Term Note Payable $                5,200 Net cash used in financing activities $            -29,425 Net increase in cash and cash equivalents $            -17,600 Add :Cash and cash equivalents at beginning of period $             85,500 Cash and cash equivalents at end of period $             67,900

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