The income statement for Midd Inc a publicly traded companyfollowing IFRS is presented here

Midd Inc

Income statement

Year end December 31, 2014

Sales                                                                                     $6,800,000

Cost of GoodSold                                                           $3,250,000

GrossProfit                                                                       $3,550,000

OperatingExpenses                                                      $1,500,000

Profit fromOperations                                                 $2,050,000

InterestExpense                                                               $150,000

Profit before Income Taxes                                       $1,900,000

IncomeTaxes                                                                     $400,000

Profit                                                                                   $1,500,000

Additional information

Operating expenses include $58,000 of depreciation expense and a$75,000 impairment loss on property, plant and equipment.

Accounts receivable decreased by $110,000

Merchandise inventory increased by $45,000

Prepaid expenses related to operating expenses increased by$65,000

Accounts payable to suppliers of merchandise decreased by$101,000

Accrued liabilities related to operating expenses increased by$22,000

Interest payable decreased by $14,000

Income tax payable increased by $35,000Question

Prepare the operating activities section of the statement ofcash flows using the Direct method. CANNOT USEINDIRECT METHOD