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 $ 34 $ 121 Accounts receivable 180 142 Prepaid insurance 12 6 Inventory 250 185 Buildings and 420 360 equipment Less: Accumulated (129) (250) depreciation Liabilities Accounts payable $ 767 $ 564 $ 97 $ 120 Accrued liabilities 11 14 Notes payable 60 0 Bonds payable 121 0 Shareholders' Equity Common stock 410 410 Retained earnings 68 20 $ 767 $ 564 RED, INC. Statement of Income For Year Ended December 31, 2021 ($ in millions) Revenues Sales revenue $2,100 Expenses Cost of goods $1,400 sold Depreciation 41 expense Operating 551 1,992 expenses Net income $ 108 Additional information from the accounting records: a. During 2021, $240 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 $60 million, it was necessary for Red to borrow $60 million from its bank.