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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

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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 below. RED, INC. Comparative Balance Sheets December 31, 2021 and 2020 ($ in millions) 2021 2020 Assets Cash $ 31 $ 150 Accounts receivable 255 239 Prepaid insurance 6 2 Inventory 215 100 Buildings and equipment 492 357 Less: Accumulated depreciation (126) (247) $ 873 $ 601 Liabilities Accounts payable 85 $ 114 Accrued liabilities 5 9 Notes payable 57 0 Bonds payable 148 0 Shareholders' Equity Common stock 407 407 Retained earnings 171 71 $ 873 601 RED, INC. Statement of Income For Year Ended December 31, 2021 is in millions) Revenues Sales revenue $2,200 Expenses Cost of goods sold $1,500 Depreciation expense 23 Operating expenses 2,043 Not income $ 157 520 Additional information from the accounting records: a. During 2021, $315 million of equipment was purchased to replace $180 million of equipment (80% depreciated) sold at book value b. In order to maintain the usual policy of paying cash dividends of $57 million, it was necessary for Red to borrow $57 million from its bank. Prepare the statement of cash flows of Red, Inc., using the direct method to report operating activities. (Enter your answers in millions (1.e., 10,000,000 should be entered as 10). Amounts to be deducted should be indicated with a minus sign.) RED, INC. Statement of Cash Flows For year onded December 31, 2021 (5 in millions) Cash flows from operating activities Cash inflows Cash outflows Net cash flows from operating activities $ Cash flows from investing activities: Net cash flows from investing activities Cash flows from financing activities: 0 0 Net cash flows from financing activities Net increase (decrease) in cash Cash balance, January 1 Cash baland December 31 0 $

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