Use the following data to answer questions in this part:

Balance sheet data
Assets	20X7	20X6
Cash	$2,900	$1,000
Accounts receivable	2,500	2,000
Inventory	7,400	8,000
Property, plant, equipment	9,200	9,000
Accumulated depreciation	(2,900)	(2,500)
Total assets	$19,100	$17,500
Liabilities and Equity
Accounts payable	$4,700	$4,500
Interest payable	1,500	1,000
Dividends payable	1,000	2,500
Long-term debt	4,350	3,700
Bank note	1,000	800
Common stock	3,300	3,000
Retained earnings	3,250	2,000
Total liabilities and equity	$19,100	$17,500

Income statement for the year 20X7
Sales	$28,500
COGS	19,900
Depreciation	3,700
Interest expense	1,244
Gain on sale of old machine	1,150
Taxes	1,142
Net income	$3,664

Notes:

• Dividends declared to shareholders were $850.

• New common shares were sold at par for $1020.
• Fixed assets were sold for $3500. Original cost of these assets was $2000, and $350 of accumulated depreciation has been charged to their original cost.
• The firm borrowed $200 in a 10-year bank note the proceeds of the loan were used to pay for new fixed assets.
• Depreciation for the year was $3700 (accumulated depreciation up $2900 and depreciation on sold assets $800).

• The company uses the LIFO inventory cost flow method. Had FIFO been used, inventories would have been $1,000 higher in 20X6 and $900 higher in 20X5.
• The effective tax rate for 20X6 was 30%. For all other years, the effective tax rate was 20%.
• At the beginning of 20X8, A firm issues a $10,000 bond with a 6% coupon rate, 4-year maturity, and annual interest payments when market interest rates are 7%.

2. Assuming IFRS, calculate cash flow from operations with the direct method. Please explain your answer by showing each step of calculation.