Answer Happy

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 $ 40 $ 148 Accounts receivable 200 148 Prepaid insurance 9 Inventory 191 Buildings and equipment 366 Less: Accumulated depreciation (256) Liabilities Accounts payable Accrued liabil ties Notes payable Bonds payable Shareholders' Equity Common stock Retained earnings 12 $1,467 41 601 300 432 (135) $ 849 $ 103 11 76 189 416 54 $ 849 RED, INC. Statement of Income. For Year Ended December 31, 2021. ($ in millions) Revenues. Sales revenue $2,200 Expenses Cost of goods sold Depreciation expense Operating expenses Net income 2,109 $ 91 $ 606 $ 132 19 0 0 416 39 $ 606
Sav a. During 2021, $246 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 $76 million, it was necessary for Red to borrow $76 million from its bank. Required: Prepare the statement of cash flows for Red, Inc., using the Indirect method to report operating activities. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) RED, INC. Statement of Cash Flows For year ended December 31, 2021 (5 in millions) Cash flows from operating activities: Adjustments for noncash effects: Changes in operating assets and liabilities: Net cash flows from operating activities Cash flows from investing activities Net cash flows from investing activities Cash flows from financing activities: $ 0 0
Changes in operating assets and liabilities: Net cash flows from operating activities Cash flows from investing activities: Net cash flows from investing activities Cash flows from financing activities: Net cash flows from financing activities Net increase (decrease) in cash Cash balance, January 1 Cash balance, December 31 $ $ 0 0 0 0