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The comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given...

The comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given below for Arduous Company. Additional information from Arduous’s accounting records is provided also.

ARDUOUS COMPANY
Comparative Balance Sheets
December 31, 2021 and 2020
($ in millions)
2021 2020
Assets
Cash $ 142 $ 100
Accounts receivable 209 232
Investment revenue receivable 25 23
Inventory 226 219
Prepaid insurance 23 32
Long-term investment 213 144
Land 235 169
Buildings and equipment 437 438
Less: Accumulated depreciation (117 ) (158 )
Patent 53 56
$ 1,446 $ 1,255
Liabilities
Accounts payable $ 69 $ 103
Salaries payable 25 37
Interest payable (bonds) 27 23
Income tax payable 31 38
Deferred tax liability 49 27
Notes payable 33 0
Lease liability 101 0
Bonds payable 234 313
Less: Discount on bonds (41 ) (46 )
Shareholders’ Equity
Common stock 487 429
Paid-in capital—excess of par 133 104
Preferred stock 94 0
Retained earnings 232 227
Less: Treasury stock (28 ) 0
$ 1,446 $ 1,255
ARDUOUS COMPANY
Income Statement For Year Ended
December 31, 2021
($ in millions)
Revenues and gain:
Sales revenue $ 589
Investment revenue 30
Gain on sale of treasury bills 2 $ 621
Expenses and loss:
Cost of goods sold 199
Salaries expense 92
Depreciation expense 13
Amortization expense 3
Insurance expense 26
Interest expense 47
Loss on sale of equipment 34
Income tax expense 55 469
Net income $ 152


Additional information from the accounting records:

  1. Investment revenue includes Arduous Company’s $25 million share of the net income of Demur Company, an equity method investee.
  2. Treasury bills were sold during 2021 at a gain of $2 million. Arduous Company classifies its investments in Treasury bills as cash equivalents.
  3. Equipment originally costing $108 million that was one-half depreciated was rendered unusable by a flood. Most major components of the equipment were unharmed and were sold for $20 million.
  4. Temporary differences between pretax accounting income and taxable income caused the deferred tax liability to increase by $22 million.
  5. The preferred stock of Tory Corporation was purchased for $44 million as a long-term investment.
  6. Land costing $66 million was acquired by issuing $33 million cash and a 10%, four-year, $33 million note payable to the seller.
  7. The right to use a building was acquired with a 15-year lease agreement; present value of lease payments, $107 million. Annual lease payments of $6 million are paid at the beginning of each year starting January 1, 2021.
  8. $79 million of bonds were retired at maturity.
  9. In February, Arduous issued a stock dividend (11.6 million shares). The market price of the $5 par value common stock was $7.50 per share at that time.
  10. In April, 1 million shares of common stock were repurchased as treasury stock at a cost of $28 million.


Required:
Prepare the statement of cash flows for Arduous Company using the indirect method. (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).)

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