Joyner Companys income statement for Year 2 follows:

Sales	$	700,000
Cost of goods sold		207,000
Gross margin		493,000
Selling and administrative expenses		216,000
Net operating income		277,000
Nonoperating items:
Gain on sale of equipment		7,000
Income before taxes		284,000
Income taxes		113,600
Net income	$	170,400

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

	Year 2			Year 1
Assets
Cash	$	120,800		$	73,300
Accounts receivable		267,000			131,000
Inventory		319,000			276,000
Prepaid expenses		9,000			18,000
Total current assets		715,800			498,300
Property, plant, and equipment		632,000			511,000
Less accumulated depreciation		166,700			130,100
Net property, plant, and equipment		465,300			380,900
Loan to Hymans Company		47,000			0
Total assets	$	1,228,100		$	879,200
Liabilities and Stockholders' Equity
Accounts payable	$	320,000		$	267,000
Accrued liabilities		44,000			55,000
Income taxes payable		84,200			80,200
Total current liabilities		448,200			402,200
Bonds payable		198,000			101,000
Total liabilities		646,200			503,200
Common stock		347,000			280,000
Retained earnings		234,900			96,000
Total stockholders' equity		581,900			376,000
Total liabilities and stockholders' equity	$	1,228,100		$	879,200

Equipment that had cost $32,000 and on which there was accumulated depreciation of $10,600 was sold during Year 2 for $28,400. 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.