I need an explanation on how to account for Depreciation in the Cash Flow from Investing. Sometimes depreciation is calculated with the change in long lived assets, sometimes it is not. Why?

On December 28, 1992, Magistretti paid 18 millions in cash and signed a 80 million mortgage on a new building acquired to accommodate an expansion of operations. Because the net income of 8 millions was the highest in the history of the company Mr. Magistretti was puzzled by the extremely low cash balance. He had always thought that profit is a major source of cash: so what happened to his cash?

REQUIRED:In order to explain Mr. Magistretti what happened to his cash prepare a cash flow statement for the YR 2 accounting period: under the indirect method.

\begin{tabular}{|c|c|c|c|} \hline & \begin{tabular}{r} MAG \\ rial balan \\ (va \end{tabular} & \begin{tabular}{l} \& Co. \\ cember 3 \\ ns) \end{tabular} & \\ \hline & & & \begin{tabular}{l} Changes: \\ Increases \\ (Decreases) \end{tabular} \\ \hline & YR 2 & YR 1 & \\ \hline debits & & & \\ \hline Cash & 2 & 40 & (38) \\ \hline Accounts Receivable & 40 & 10 & 30 \\ \hline Inventory & 92 & 30 & 62 \\ \hline Prepaid General Exp. & 8 & 4 & 4 \\ \hline Fixed Assets, net & 182 & 100 & 82 \\ \hline Total & 324 & 184 & 140 \\ \hline credits & & & \\ \hline Accounts payable for merchandise & 78 & 28 & 50 \\ \hline Accrued property tax payable & 6 & 2 & 4 \\ \hline Mortgage payable & 80 & 0 & 80 \\ \hline Capital stock & 140 & 140 & 0 \\ \hline Retained earnings & 20 & 14 & 6 \\ \hline Total & 324 & 184 & 140 \\ \hline \end{tabular}