Below is the Statement of Cashflows for the year 2019 of ABC Corp and answer the questions that follow in the space provided:

Cashflow from Operating Activities
Cash Collections	Sales	3,200,000.00
	Increase in Receivables	(60,000.00)	3,140,000.00
	Interest Revenue	40,000.00
	Decrease in Interest Receivable	2,000.00	42,000.00
Cash Payments to Suppliers	COGS	(1,620,000.00)
	Decrease in Inventory	60,000.00
	Decrease in Accounts Payable	(16,000.00)	(1,576,000.00)
Cash payments for	Operating Expenses	(1,240,000.00)
Operating Expenses	Depreciation	150,000.00
	Increase in Prepayments	(6,000.00)
	Decrease in accruals	(8,000.00)	(1,104,000.00)
Cash Payments for Interest	Interest Expense	(42,000.00)
	Increase in interest payable	4,000.00	(38,000.00)
Cash Payments for Tax	Tax Expense	(100,000.00)
	Decrease in tax payable	(14,000.00)	(114,000.00)
Cashflows provided by Operating Activities			350,000.00
Cashflow from Investing Activities
Investments in Securities		(60,000.00)
Sale of Securities		72,000.00	12,000.00
Investments in Plant Assets		(500,000.00)
Sale of Plant Assets		24,000.00	(476,000.00)
Cashflows used by Investing Activities			(464,000.00)
Cashflows from Financing Activities
Repayments of Long Term Notes Payable		(92,000.00)
Proceeds from Long Term Notes Payable		82,000.00	(10,000.00)
Issuance of CS	Par Value	20,000.00
	Additional Paid In Capital	160,000.00	180,000.00
Dividends Paid			(120,000.00)
Notes Receivable issued		(44,000.00)
Notes Receivable collected		28,000.00	(16,000.00)
Cashflows provided by Financing Activities			34,000.00
Net Change in Cash			(80,000.00)
Cash Beginning			244,000.00
Cash end			164,000.00

Instructions:

1) Carry out a complete analysis of tbe above figures. Comment on the companys Statement of Cashflows by looking at the sources and uses of funds.

2) Explain the primary reason why:

a) The amount of cash provided by operating activities was substantially greater than the companys net income of USD 260,000

b) There was a net decrease in cash over the year, despite the substantial amount of cash provided by operating activities.

3) The Companys controller thinks that through more efficient cash management, the company could have held the increase in accounts receivable for the year to $10,000, without affecting net income. Explain how holding down the growth in receivables affects cash. Compute the effect that limiting the growth in receivables to $10,000 would have had on the companys net increase or decrease in cash (and cash equivalents) for the year.