Joyner Companys income statement for Year 2 follows:

Sales	$	718,000
Cost of goods sold		256,000
Gross margin		462,000
Selling and administrative expenses		217,000
Net operating income		245,000
Gain on sale of equipment		6,000
Income before taxes		251,000
Income taxes		75,300
Net income	$	175,700

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

	Year 2		Year 1
Assets
Cash	$	123,300	$	66,400
Accounts receivable		263,000		149,000
Inventory		319,000		275,000
Prepaid expenses		9,000		18,000
Total current assets		714,300		508,400
Property, plant, and equipment		622,000		507,000
Less accumulated depreciation		166,000		131,700
Net property, plant, and equipment		456,000		375,300
Loan to Hymans Company		46,000		0
Total assets	$	1,216,300	$	883,700
Liabilities and Stockholders' Equity
Accounts payable	$	313,000	$	269,000
Accrued liabilities		41,000		50,000
Income taxes payable		85,500		80,700
Total current liabilities		439,500		399,700
Bonds payable		198,000		109,000
Total liabilities		637,500		508,700
Common stock		343,000		283,000
Retained earnings		235,800		92,000
Total stockholders' equity		578,800		375,000
Total liabilities and stockholders' equity	$	1,216,300	$	883,700

Equipment that had cost $30,200 and on which there was accumulated depreciation of $11,100 was sold during Year 2 for $25,100. 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 for operating activities for Year 2. (Negative amount should be indicated by a minus sign.)

2.

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 - Indirect Method
For Year 2
Operating activities:
Adjustments to convert net income to cash basis:
Investing activities:
Financing activities:
Beginning cash and cash equivalents
Ending cash and cash equivalents

3.	Compute the free cash flow for Year 2. (Negative amount should be indicated by a minus sign.)