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Comparative balance sheets for 2021 and 2020, a statement of income for 2021, and additional information from the accounting records of Red, Inc., are provided

Comparative balance sheets for 2021 and 2020, a statement of income for 2021, and additional information from the accounting records of Red, Inc., are provided below.

RED, INC. Comparative Balance Sheets December 31, 2021 and 2020 ($ in millions)
2021 2020
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 liabilities 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, 2021
($ 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:

  1. During 2021, $230 million of equipment was purchased to replace $180 million of equipment (95% depreciated) sold at book value.
  2. 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 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.)

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