Comparative balance sheets for 2013 and 2012, a statement of income for 2013, and additional information from the accounting records of Red, Inc., are provided below.

RED, INC. Comparative Balance Sheets December 31, 2013 and 2012 ($ in millions)
	2013			2012
Assets
Cash	$	24		$	110
Accounts receivable		178			132
Prepaid insurance		7			3
Inventory		285			175
Buildings and equipment		400			350
Less: Accumulated depreciation		(119	)		(240	)
	$	775		$	530
Liabilities
Accounts payable	$	87		$	100
Accrued expenses payable		6			11
Notes payable		50			0
Bonds payable		160			0
Shareholders Equity
Common stock		400			400
Retained earnings		72			19
	$	775		$	530

RED, INC. Statement of Income For Year Ended December 31, 2013 ($ in millions)
Revenues
Sales revenue				$	2,000
Expenses
Cost of goods sold	$	1,400
Depreciation expense		50
Operating expenses		447			1,897
Net income				$	103

Additional information from the accounting records:

a.	During 2013, $230 million of equipment was purchased to replace $180 million of equipment (95% depreciated) sold at book value.

b.

In order to maintain the usual policy of paying cash dividends of $50 million, it was necessary for Red to borrow $50 million from its bank. Required: Prepare the statement of cash flows of Red, Inc. using the indirect method to report operating activities.(Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10.).)

RED, INC. Statement of Cash Flows For year ended December 31, 2013 in millions) Cash flows from operating activities: Net income Adjustments for noncash effects Changes in operating assets and liabilities: Net cash flows from operating activities Cash flows from investing activities Net cash flows from investing activities Cash flows from financing activities Net cash flows from financing activities Net increase (decrease) in cash Cash balance, January 1 Cash balance, December 31 0 0 0 0