You are the controller for 21st Technologies. Your staff has prepared an income statement for the current year and has developed the following additional information by analyzing changes in the companys balance sheet accounts.

AH Tech

Income Statement

For the Year Ended December 31, 2019

Revenue:
Net sales	$3,200,000
Interest revenue	$40,000
Gain on sales of marketable securities	$34,000
Total revenue and gains	$3,274,000
Costs and expenses:
Cost of goods sold	$1,620,000
Operating expenses (including depreciation of $150,000)	$1,240,000
Interest expense	$42,000
Income taxes	$100,000
Loss on sales of plant assets	$12,000
Total costs, expenses, and losses	3,014,000
Net income	$ 260,000

Additional Information

Accounts receivable increased by $60,000.

Accrued interest receivable decreased by $2,000.

Inventory decreased by $60,000, and accounts payable to suppliers of merchandise decreased by $16,000.

Short-term prepayments of operating expenses increased by $6,000, and accrued liabilities for operating expenses decreased by $8,000.

The liability for accrued interest payable increased by $4,000 during the year.

The liability for accrued income taxes payable decreased by $14,000 during the year.

The following schedule summarizes the total debit and credit entries during the year in other balance sheet accounts:

	DEBIT ($)	CREDIT ($)
Marketable Securities	60,000	38,000
Notes Receivable (cash loans made to borrowers)	44,000	28,000
Plant Assets (see paragraph 8)	500,000	36,000
Notes Payable (short-term borrowing)	92,000	82,000
Capital Stock		20,000
Additional Paid-in Capital: Capital Stock		160,000
Retained Earnings (see paragraph 9)	120,000	260,000

The $36,000 in credit entries to the Plant Assets account is net of any debits to Accumulated Depreciation when plant assets were retired. Thus the $36,000 in credit entries represents the book value of all plant assets sold or retired during the year.

The $120,000 debit to retained earnings represents dividends declared and paid during the year. The $260,000 credit entry represents the net income shown in the income statement.

All investing and financing activities were cash transactions.

Cash and cash equivalents amounted to $244,000 at the beginning of the year and to $164,000 at year-end.

Instructions:

Construct the company's Statement of Cashflows.

Analyze the companys Statement of Cashflows by looking at the sources and uses of funds explaining the primary reason why the amount of cash provided by operating activities was substantially greater than the companys net income of USD 260,000 while there being a net decrease in cash over the year.

Do you think that think that through more efficient cash management and holding down the growth in receivables affect would have improved the figures.