An analysis of the machinery accounts of Sheridan Company for 2021 is as follows:

Machinery, Net of

Accumulated Accumulated

Machinery Depreciation Depreciation

Balance at January 1, 2021

$501000 $129000 $372000

Purchases of new machinery in 2021 for cash

207000 207000

Depreciation in 2021

110000 (110000 )

Balance at Dec. 31, 2021

$708000 $239000 $469000

The information concerning Sheridan's machinery accounts should be shown in Sheridan's statement of cash flows (indirect method) for the year ended December 31, 2021, as a(n)

$207000 decrease in cash flows from investing activities.

addition to net income of $110000 and a $207000 decrease in cash flows from investing activities.

$110000 increase in cash flows from financing activities.

subtraction from net income of $110000 and a $207000 decrease in cash flows from financing activities.