Analysis of Cash Flows Gerrard Company reported the following cash flows for the year ending Decembetes lr

Explain your answer to each of the following:

a. Is the presentation of Gerrard’s cash flows from operations based on the direct or indirect method?

b. Is Gerrard in a good position to pay a cash dividend in the near future?

c. Is Gerrard expanding or contracting its operations?

d. Has Gerrard financed its purchase of new assets by borrowing additional money or by other means? What has been its primary sources of cash during the current year?

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Cash flows from operations: Cash receipts from sales of product Cash payments to suppliers Cash payments to employees Cash payments to others Cash provided by operations Cash flows from investing activities: Sale of investments Purchase of equipment Cash used in investing activities Cash flows from financing activities: Issuance of capital stock Increase in cash Beginning cash balance Ending cash balance $ 600,000 (1,000,000) $1,300,000 (720,000) (410,000) (120,000) $ 50,000 (400,000) 380,000 30,000 10,000 $ 40,000