Joyner Companys income statement for Year 2 follows:

Sales	$	718,000
Cost of goods sold		221,000
Gross margin		497,000
Selling and administrative expenses		217,000
Net operating income		280,000
Nonoperating items:
Gain on sale of equipment		9,000
Income before taxes		289,000
Income taxes		115,600
Net income	$	173,400

Its balance sheet amounts at the end of Years 1 and 2 are as follows:

	Year 2			Year 1
Assets
Cash	$	110,400		$	60,900
Accounts receivable		271,000			128,000
Inventory		319,000			287,000
Prepaid expenses		9,500			19,000
Total current assets		709,900			494,900
Property, plant, and equipment		627,000			512,000
Less accumulated depreciation		165,700			131,900
Net property, plant, and equipment		461,300			380,100
Loan to Hymans Company		40,000			0
Total assets	$	1,211,200		$	875,000
Liabilities and Stockholders' Equity
Accounts payable	$	314,000		$	253,000
Accrued liabilities		41,000			58,000
Income taxes payable		85,100			81,000
Total current liabilities		440,100			392,000
Bonds payable		193,000			106,000
Total liabilities		633,100			498,000
Common stock		344,000			286,000
Retained earnings		234,100			91,000
Total stockholders' equity		578,100			377,000
Total liabilities and stockholders' equity	$	1,211,200		$	875,000

Equipment that had cost $30,400 and on which there was accumulated depreciation of $10,000 was sold during Year 2 for $29,400. 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 2.