Comparative balance sheets for 2021 and 2020, a statement of income for 2021, and additional information from the accoun

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Comparative Balance Sheets For 2021 And 2020 A Statement Of Income For 2021 And Additional Information From The Accoun 1 (37.56 KiB) Viewed 35 times

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 (S in millions) 2021 2020 Assets Cash $24 S110 Account receivable 178 132 Prepaid insurance 7 3 Inventory 285 175 Building and equipment 400 350 Less: Accumulated depreciation (119) 240 Total Assets $ 775 5 530 Liabilities Accounts payable 587 $100 Accrued liabilities 6 Notes playable 50 Bonds payable 160 0 Shareholders Equity Common stock 400 400 Retained earnings 72 19 Total Liabilities 5 775 $530 Red, Inc. Statement of Income For Year Ended December 31, 2021 (Sin millions) Revenues Sales revenue 52.000 Expenses Cost of good sold $1,400 Depreciation expenses 50 Operating expenses 447 1.897 Net Income S103 Additional information from accounting records: a. During 2021, 5230 million of equipment was purchase to replace $180 million of cquipment (95% depreciated) sold at book value b. In order to maintain the usual policy of paying cash dividends of $50 million, it was necessary for Red to borrow $50 million from its bank Required: Prepare the statement of cash flow of Red, Inc., for the years ended December 31, 2021. Present Cash Flows from operating activities by the direct method