There are several files used to set up ATK. They are located in the automated_testing_kit/module_support folder or the development folder under that.

Script
Notes
atk_setup   
(Bash script)
Copies or links tests and utility files to default locations for Cypress or Playwright. Run this as part of installation.   
Note: linking may make it impossible for your IDE to debug the files.
cypress.config.js

When installing ATK for Cypress, the atk_setup script copies this to the root of the project (above /web) and renames it to config.js.

It is used by Cypress and contains configuration to run ATK in Cypress, such as registration of the cy-log-to-term plugin.

Change the value of baseUrl to match your installation.

cypress.atk.config.js

When installing ATK for Cypress, the atk_setup script copies this to the root of the project (above /web) and renames it to atk.config.js.

It is used by ATK and contains configuration specific to Cypress, such as the location of directories.

playwright.config.js

When installing for Playwright, the atk_setup script copies this to the root of the project (above /web) and renames it to config.js.

It is used by Playwright and contains configuration to run ATK in Playwright, such as requiring the dotenv library.

playwright.atk.config.js

When installing ATK for Playwright, the atk_setup script copies this to the root of the project (above /web) and renames it to atk.config.js.

It is used by ATK and contains configuration specific to Playwright, such as the location of directories.

development/cypress.package.json
Holds a working package.json for Cypress when developing. It contains extra libraries, like eslint, that you don't need in production.
development/playwright.package.json
Sample package.json for Playwright when developing. It contains extra libraries, like eslint, that you don't need in production.
development/.eslintrc.js
Configuration file to run ESLint.
development/.prettierrc
Configuration file to run Prettier.