Guys, what does it mean if my guy friend makes a sexual innuendo?

My guy friend and I have great chemistry and seem to be attracted to each other based on a lot of signs. Anyway, I meant to ask if he wanted to have me paint his hand or him paint mine and I said "Do you want me to do you?" And then we both smirked. He goes, "Is this a trick question?" And I just chuckled. Then after he held out his arm and said "Do you want top or bottom?" And we both were smirking. Does this mean anything?