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Comparative balance sheets for 2018 and 2017, a statement of income for 2018, and additional information from the accounting records of Red, Inc., are provided

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Comparative balance sheets for 2018 and 2017, a statement of income for 2018, and additional information from the accounting records of Red, Inc., are provided below. RED, INC. Comparative Balance Sheets December 31, 2018 and 2e17 ($ in millions) 2018 2017 Assets Cash Accounts receivable Prepaid insurance Inventory Buildings and equipment Less: Accumulated depreciation $ 28 $ 114 136 184 13 250 179 451 354 (123) $ 803 (244) $ 547 Liabilities Accounts payable Accrued expenses payable Notes payable Bonds payable Shareholders' Equity Common stock Retained earnings $ 93 $ 108 18 12 54 172 404 404 68 17 $ 803 $ 547 RED, INC. Statement of Income For Year Ended December 31, 2018 ($ in millions) Revenues $2,020 Sales revenue Expenses Cost of goods sold Depreciation expense Operating expenses $1,414 41 1,915 $ 105 460 Net income 1 of 5 ... Additional information from the accounting records: a. During 2018, $277 million of equipment was purchased to replace $180 million of equipment (90% depreciated) sold at book value. b. In order to maintain the usual policy of paying cash dividends of $54 million, It was necessary for Red to borrow $54 million from its bank. Requlred: Prepare the statement of cash flows of Red, Inc., using the direct method to report operating activities. (Enter your answers In mlllons (L.e., 10,000,000 should be entered as 10). Amounts to be deducted should be Indicated with a minus sign.) Answer is not complete. RED, INC. Statement of Cash Flows For year ended December 31, 2018 (S in millions) Cash flows from operating activities Cash inflowa Is From customers 1,972 Cash outfiows (1,500) C (471)O To suppliers of goods For operating expenses Net cash flowe from operating activities Cash flows from investing activities: Purchase of equipment (277)O 18 O Sale of equipment Net cash flowe from inveating activities (250) Cash flows from financing activities: 54 Issuance of note payable Issuance of bonds payable 172 (54) O Payment of cash dividends 172 Net cash flowe from financing activities (00) Net increase (decrease) in cash Cash balance, January 1 Cash balance, December 31 (86)

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