Holmes Company reported the following balance sheets at December 31, 20X2and 20X1:

Its income statement for 20X2was as follows:

Additional information:

During 20X2, Holmes had the following transactions:

1. Declared and paid a common dividend of $78million.
2. Purchased additional fixed assets, but did not sell any.
3. Issued $30 million of new debt.
4. Paid interest on all its debt, and included the interest in Other operating expenses.
5. Repurchased common shares, but did not issue any.

Required:

Prepare a cash flow statement for Holmes for 20X2, using the indirect method to present the operating section. For your calculations, it may be helpful to use the worksheet approach described in the chapter appendix to construct the cash flow statement. (Net cash outflows and amounts to be deducted should be indicated by a minus sign. Enter your answers in millions.)

\begin{tabular}{lr} (\$ in millions) & \\ Sales & $1,000 \\ Cost of sales & (670) \\ Depreciation & (30) \\ Other operating expenses & (100) \\ Income before taxes & 200 \\ Income taxes & (42) \\ Net income & $158 \\ \cline { 2 - 2 } \end{tabular} Holmes Company Statement of Cash Flows For the year ended December 31, 20X2 ( $ in millions) Operating activities: \begin{tabular}{|l|r|} \hline Operating activities: & \$ \\ \hline Net income & 158 \\ \hline Depreciation & 30 \\ \hline Change in working capital: & (20) \\ \hline Decrease in accounts receivable & 20 \\ \hline Increase in inventory & \\ \hline Increase in accounts payable & 193 \\ \hline & \\ \hline Cash flow from operating activities & \\ \hline Investing activities: & \\ \hline Capital expenditure & \\ \hline & \\ \hline Cash flow from investing activities & \\ \hline Financing activities: & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline & \\ \hline Cash at end of year & \\ \hline Net change in cash & \\ \hline Cash at beginning of year & \\ \hline \end{tabular}