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) Assets Cash Accounts receivable Prepaid insurance Inventory Buildings and equipment Less: Accumulated depreciation Liabilities Accounts payable Accrued liabilities Notes payable Bonds payable Common stock Shareholders' Equity Retained earnings 2021 2020 $ 32 149 $ 128 140 8 4 301 183 416 358 (127) (248) $ 779 $ 565 $ 95 $ 116 7 12 33 0 170 0 408 408 66 29 $ 779 $ 565 RED, INC. Statement of Income For Year Ended December 31, 2021 Revenues ($ in millions) Sales revenue $2,060 Expenses Cost of goods sold Depreciation expense Operating expenses $1,457 41 492 1,990 Net income $ 70 Additional information from the accounting records: a. During 2021, $238 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 $33 million, it was necessary for Red to borrow $33 million from its bank.