Linamar Corporation reported the following items on its statement of cash flows:

1. _____ Repayment of long-term debt

2. _____ Depreciation of property, plant, and equipment

3. _____ Payments for purchase of property, plant, and equipment

4. _____ Dividends to shareholders

5. _____ Repayment of debentures (bonds)

6. _____ Proceeds from long-term debt

(a) Indicate in which section each of the above items was reported in Linamar's statement of cash flows-operating activity (O), investing activity (I), or financing activity (F).

(b) Does Linamar 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.