P 14-4 LO4 Cash Flows from Operations (Indirect Method) Gordon Enterprises reported a net loss of $80,000 for the year just ended. Relevant data for the company follow. Assume that there is no income tax incurred. If the item has alternative classification, do not classify it as operating cash flows. Beginning Year End of of Year Cash and cash equivalents. Accounts receivable (net). Inventory ... Prepaid expenses Accounts payable Accrued liabilities Dividends payable Depreciation for the year, $86,000 Dividends declared, $70,000 $100,000 160,000 246.000 15,000 110,000 20,000 50,000 $ 40,000 130,000 260,000 9,000 120,000 8,000 70,000 Required: 1. Using the indirect method, determine the net cash flows provided by (used in) operating activities for Gordon Enterprises. 2. Interpretive Question: Explain how Gordon Enterprises can pay cash dividends during a year when it reports a net loss