Comparative balance sheets for 2017 and 2018, a statement of income for 2018, and additional information from the accounting records of Brown Company are provided below. BROWN COMPANY Comparative Balance Sheets December 31, 2018 and 2017 ($ in millions) 2017 2018

Assets Cash $ 170 $ 195

Accounts receivable 44 61

Allowance for uncollectible accounts (4 ) (6 )

Investment in A Corp 18 18

Fair value adjustment 2 5

Investment in B Inc 45 49

Inventory 35 48

Prepaid insurance 6 4

Supplies 15 13

Bond receivable 70 70

Premium on bond receivable 4 3

Lease receivable 0 23

Land 150 150

Building 240 280

Less: Accumulated depreciation (50 ) (62 )

Equipment 80 95

Less: Accumulated depreciation (8 ) (12 )

Right of use asset 0 20

Less: Accumulated amortization 0 (4 )

Total Assets $ 817 $ 950

Liabilities Accounts payable $ 56 $ 62

Salaries payable 8 10

Bond interest payable 3 4

Operating lease payable 0 18

Loan payable 70 63

Bond payable 260 260

Premium on bond payable 12 10

Owners Equity Common stock 250 280

Contributed capital in excess of par 50 90

Retained earnings 108 186

Dividend 0 (33 )

Total Liabilities & Equity $ 817 $ 950

BROWN COMPANY Income Statement For Year Ended December 31, 2018 ($ in millions)

Revenues Sales revenue $ 420

Expenses Cost of goods sold $ 170

Bad debt expense 6

Insurance expense 44

Supplies expense 38

Depreciation expense 20

Salaries expense 55

Amortiztion expense 4

Utilities expense 11

Total 348

Income from operations $ 72

Other income and expenses Bond interest revenue 11

Gain on sale of equipment 10

Investment income 8

Unrealized holding gain A Corp 3

Bond interest expense (13 )

Loan interest expense (10 )

Lease interest expense (3 )

Total other income and expenses 6

Net income $ 78

Additional information from the accounting records:

a) The building has a life of 20 years

b) Equipment that originally cost $20 was sold

c) The lease receivable was a sales type lease Required:

Prepare the statement of cash flows of Brown Company using the direct method to report operating activities. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Amounts to be deducted should be indicated with a minus sign.)