Mega Brands Inc. reported the following items on its statement of cash flows:
1. ______ Repayment of long-term debt
2. ______ Depreciation expense
3. ______ Acquisition of property, plant, and equipment
4. ______ Issue of common shares
5. ______ Repayment of debentures (bonds)
6. ______ Changes in noncash operating working capital items?
(a) Indicate in which section each of the above items was reported in Mega Brands' statement of cash flows-operating activity (O), investing activity (I), or financing activity (F).
(b) Does Mega Brands use the indirect or direct method of preparing the operating activities section of its statement of cash flow? Explain how you came to your conclusion?