15-10 (Static) Prepare a Statement of Cash Flows; Free Cash Flow [LO15-1, LO15-2, LO15-3] Joyner Companys income statement for Year 2 follows: Income before taxes Income taxes Sales $ 900,000 Cost of goods sold 500,000 Gross margin 400,000 Selling and administrative expenses 328,000 Net operating income 72,000 Nonoperating items: Gain on sale of equipment 8,000 Income before taxes 80,000 Income taxes 24,000 Net income $ 56,000 Its balance sheet amounts at the end of Years 1 and 2 are as follows: Year 2 Year 1 Assets Cash $ 4,000 $ 21,000 Accounts receivable 250,000 170,000 Inventory 310,000 260,000 Prepaid expenses 7,000 14,000 Total current assets 571,000 465,000 Property, plant, and equipment 510,000 400,000 Less accumulated