15-10 (Algo) Prepare a Statement of Cash Flows; Free Cash Flow [LO15-1, LO15-2, LO15-3] Joyner Company's income statement for Year 2 follows: Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items: Gain on sale of equipment Income before taxes Income taxes Net income $ 915,000 503,250 411,750 332,000 79,750 9,000 88,750 26,625 $ 62,125 Its balance sheet amounts at the end of Years 1 and 2 are as follows: Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Loan to Hymans Company Total assets Year 2 Year 1 $ -30,775 251,000 $ 13,900 170,000 314,000 258,000 8,000 16,000 542,225 457,900 504,000 383,000 126,000 114,900 378,000 268,100 40,000 $ 960,225 Liabilities and Stockholders' Equity Accounts payable Accrued liabilities $ 308,000 21,000 $ 726,000 $ 249,000 32,000 Income taxes payable 49,000 45,000 Total current liabilities 378,000 326,000 Bonds payable 187,000 66,000 Total liabilities 565,000 392,000 Common stock 280,000 250,000 Retained earnings 115,225 84,000 Total stockholders' equity 395,225 334,000 $ 960,225 $ 726,000 Total liabilities and stockholders' equity Equipment that had cost $42,000 and on which there was accumulated depreciation of $33,000 was sold during Year 2 for $18,000. The company declared and paid a cash dividend during Year 2. It did not retire any bonds or repurchase any of its own stock. Required: 1. Using the indirect method, compute the net cash provided by/used in operating activities for Year 2. 2. Prepare a statement of cash flows for Year 2. 3 Compute the free cash flow for Year? Required: 1. Using the indirect method, compute the net cash provided by/used in operating activities for Year 2. 2. Prepare a statement of cash flows for Year 2. 3. Compute the free cash flow for Year 2. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using the indirect method, compute the net cash provided by/used in operating activities for Year 2. (List any deduction in cash outflows as negative amounts.) Joyner Company Statement of Cash Flows-Indirect Method (partial) 0 $ 0 Required 1 Required 2 > Required: 1. Using the indirect method, compute the net cash provided by/used in operating activities for Year 2. 2. Prepare a statement of cash flows for Year 2. 3. Compute the free cash flow for Year 2. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a statement of cash flows for Year 2. (List any deduction in cash and cash outflows as negative amounts.) Joyner Company Statement of Cash Flows Operating activities: Investing activities: Financing activities: Beginning cash and cash equivalents Ending cash and cash equivalents For Year 2 < Required 1 0 0 0 $ 0 Required 3 > Required: 1. Using the indirect method, compute the net cash provided by/used in operating activities for Year 2. 2. Prepare a statement of cash flows for Year 2. 3. Compute the free cash flow for Year 2. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the free cash flow for Year 2. (Negative amount should be indicated by a minus sign.) Free cash flow < Required 2 Required 3 >