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Comparative balance sheets for 2016 and 2015, a statement of income for 2016, and additional information from the accounting records of Red, Inc., are provided below.

RED, INC. Comparative Balance Sheets December 31, 2016 and 2015 ($ in millions)
	2016			2015
Assets
Cash	$	30		$	122
Accounts receivable		190			138
Prepaid insurance		13			9
Inventory		254			181
Buildings and equipment		455			356
Less: Accumulated depreciation		(125	)		(246	)
	$	817		$	560
Liabilities
Accounts payable	$	97		$	112
Accrued expenses payable		12			21
Notes payable		56			0
Bonds payable		162			0
Shareholders Equity
Common stock		406			406
Retained earnings		84			21
	$	817		$	560

RED, INC. Statement of Income For Year Ended December 31, 2016 ($ in millions)
Revenues
Sales revenue				$	2,080
Expenses
Cost of goods sold	$	1,444
Depreciation expense		31
Operating expenses		486			1,961
Net income				$	119

Additional information from the accounting records:

a.	During 2016, $289 million of equipment was purchased to replace $190 million of equipment (80% depreciated) sold at book value.

b.	In order to maintain the usual policy of paying cash dividends of $56 million, it was necessary for Red to borrow $56 million from its bank.

Required:

Prepare the statement of cash flows of Red, Inc. using the direct method to report operating activities. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Amounts to be deducted should be indicated with a minus sign.)

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