Required information Skip to question The following information applies to the questions displayed below 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 $ 36 0 $ 135 0 Accounts receivable 162 0 122 0 Prepaid insurance 14 0 7 0 Inventory 272 0 164 0 Buildings and equipment 368 0 320 0 Less Accumulated depreciation (72 0 ) (224 0 ) $ 780 0 $ 524 0 Liabilities Accounts payable $ 82 0 $ 96 0 Accrued liabilities 8 0 15 0 Notes payable 50 0 0 0 Bonds payable 175 0 0 0 Shareholders Equity Common stock 400 0 400 0 Retained earnings 65 0 13 0 $ 780 0 $ 524 0 RED, INC Statement of Income For Year Ended December 31, 2021 ($ in millions) Revenues Sales revenue $ 1,880 0 Expenses Cost of goods sold $ 1,316 0 Depreciation expense 38 0 Operating expenses 424 0 1,778 0 Net income $ 102 0 Additional information from the accounting records During 2021, $248 0 million of equipment was purchased to replace $200 0 million of equipment (95 0 depreciated) sold at book value In order to maintain the usual policy of paying cash dividends of $50 0 million, it was necessary for Red to borrow $50 0 million from its bank Required Prepare the T account for Red, Inc (Enter your answers in millions rounded to 1 decimal place (i e , 5,500,000 should be entered as 5 5) ) Required Prepare the T account for Red, Inc (Enter your answers in millions rounded to 1 decimal place (i e , 5,500,000 should be entered as 5 5) ) Answer is not complete Cash (Statement of Cash Flows) Beg Bal Operating Activities From customers To suppliers Investing Activities Sale of equipment Purchase of equipment Financing Activities Issuance of notes Issuance of bonds Payment of dividends End Bal Answer is not complete Accounts Receivable Beg Bal 122 0 Beg Bal For expenses Prepaid Insurance 7 0 7 0 End Bal 122 0 End Bal 14 0 Inventory 164 0 Buildings and Equipment 320 0 Beg Bal Beg Bal End Bal 164 0 End Bal 320 0 Accounts Payable Accumulated Depreciation 224 0 Beg Bal 96 0 Beg Bal For expenses x End Bal 224 0 End Bal 96 0 Accrued Liabilities Notes Payable 0 0 Beg Bal 15 0 Beg Bal 50 0Issuance of notes End Bal 15 0 End Bal 50 0 Sales Bonds Payable 0 0 Beg Bal Beg Bal 175 0 Issuance of bonds 1,800 0 X From customers End Bal 175 0 End Bal 1,800 0 Cost of Goods Sold Beg Bal To suppliers Beg Bal Depreciation expense Depreciation Expense 0 0 38 0 13,160 0 X End Bal 13,160 0 End Bal 38 0 Cost of Goods Sold Beg Bal To suppliers Beg Bal Depreciation expense Depreciation Expense 0 0 38 0 13,160 0 X End Bal 13,160 0 End Bal 38 0 Operating Expenses Net Income (Income Summary) Beg Bal For expenses Beg Bal Net Income 424 0 102 0 x End Bal 424 0 End Bal 102 0 Common Stock Retained Earnings 13 0 50 0 102 0 Net income Beg Bal Beg Bal Payment of dividends 400 0 End Bal 65 0 End Bal 400 0

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Required information Skip to question [The following information applies to the questions displayed below.] Comparative balance sheets for 2021 and 2020, a statement of income

Required information

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[The following information applies to the questions displayed below.] 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	$	36.0		$	135.0
Accounts receivable		162.0			122.0
Prepaid insurance		14.0			7.0
Inventory		272.0			164.0
Buildings and equipment		368.0			320.0
Less: Accumulated depreciation		(72.0	)		(224.0	)
	$	780.0		$	524.0
Liabilities
Accounts payable	$	82.0		$	96.0
Accrued liabilities		8.0			15.0
Notes payable		50.0			0.0
Bonds payable		175.0			0.0
Shareholders Equity
Common stock		400.0			400.0
Retained earnings		65.0			13.0
	$	780.0		$	524.0

RED, INC. Statement of Income For Year Ended December 31, 2021
($ in millions)
Revenues
Sales revenue			$	1,880.0
Expenses
Cost of goods sold	$	1,316.0
Depreciation expense		38.0
Operating expenses		424.0		1,778.0
Net income			$	102.0

Additional information from the accounting records:

During 2021, $248.0 million of equipment was purchased to replace $200.0 million of equipment (95.0% depreciated) sold at book value.
In order to maintain the usual policy of paying cash dividends of $50.0 million, it was necessary for Red to borrow $50.0 million from its bank.

Required: Prepare the T-account for Red, Inc. (Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).)

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Required: Prepare the T-account for Red, Inc. (Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).) Answer is not complete. Cash (Statement of Cash Flows) Beg. Bal. Operating Activities: From customers To suppliers Investing Activities: Sale of equipment Purchase of equipment Financing Activities: Issuance of notes Issuance of bonds Payment of dividends End. Bal. > Answer is not complete. Accounts Receivable Beg. Bal 122.0 Beg. Bal For expenses Prepaid Insurance 7.0 7.0 End. Bal 122.0 End. Bal 14.0 Inventory 164.0 Buildings and Equipment 320.0 Beg. Bal Beg. Bal End. Bal 164.0 End. Bal 320.0 Accounts Payable Accumulated Depreciation 224.0 Beg. Bal 96.0 Beg. Bal For expenses x End. Bal 224.0 End. Bal 96.0 Accrued Liabilities Notes Payable 0.0 Beg. Bal 15.0 Beg. Bal 50.0Issuance of notes End. Bal 15.0 End. Bal 50.0 Sales Bonds Payable 0.0 Beg. Bal Beg. Bal 175.0 Issuance of bonds 1,800.0 X From customers End. Bal 175.0 End. Bal 1,800.0 Cost of Goods Sold Beg. Bal To suppliers Beg. Bal Depreciation expense Depreciation Expense 0.0 38.0 13,160.0 X End. Bal 13,160.0 End. Bal 38.0 Cost of Goods Sold Beg. Bal To suppliers Beg. Bal Depreciation expense Depreciation Expense 0.0 38.0 13,160.0 X End. Bal 13,160.0 End. Bal 38.0 Operating Expenses Net Income (Income Summary) Beg. Bal For expenses Beg. Bal Net Income 424.0 102.0 x End. Bal 424.0 End. Bal 102.0 Common Stock Retained Earnings 13.0 50.0 102.0 Net income Beg. Bal Beg. Bal Payment of dividends 400.0 End. Bal 65.0 End. Bal 400.0