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Comparative balance sheets for 2018 and 2017, a statement of income for 2018, and additional information from the accounting records of Red, Inc., are provided below. RED, INC Comparative Balance Sheets December 31, 2018 and 2017 ($ in millions) 2018 2017 Assets $ 110 Cash 24 Accounts receivable 178 132 Prepaid insurance Inventory Buildings and equipment Less: Accumulated depreciation 3 285 175 400 350 (119) $ 775 (240) $530 Liabilities $ 100 Accounts payable Accrued expenses payable Notes payable Bonds payable Shareholders' Equity 87 6 11 50 160 C 400 Common stock 400 Retained earnings 72 19 $ 775 $530 RED, INC Statement of Income For Year Ended December 31, 2018 ($ in millions) Revenues Sales revenue $2,000 Expenses Cost of goods sold Depreciation expense Operating expenses $1,400 50 447 1,897 S 103 Net income Additional information from the accounting records: a. During 2018, $230 million of equipment was purchased to replace $180 million of equipment (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 $50 million from its bank. Required: Prepare the statement of cash flows of Red, Inc. using the indirect method to report operating activities. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) RED, INC. Statement of Cash Flows For year ended December 31, 2018 ($ 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: Net cash flows from financing activities Net increase (decrease) in cash Cash balance, January 1 Cash balance, December 31

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