Joyner Companys income statement for Year 2 follows:

Sales	$	705,000
Cost of goods sold		236,000
Gross margin		469,000
Selling and administrative expenses		217,000
Net operating income		252,000
Nonoperating items:
Gain on sale of equipment		7,000
Income before taxes		259,000
Income taxes		103,600
Net income	$	155,400

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

	Year 2			Year 1
Assets
Cash	$	98,700		$	116,900
Accounts receivable		266,000			112,000
Inventory		319,000			271,000
Prepaid expenses		11,000			22,000
Total current assets		694,700			521,900
Property, plant, and equipment		631,000			512,000
Less accumulated depreciation		165,900			130,200
Net property, plant, and equipment		465,100			381,800
Loan to Hymans Company		44,000			0
Total assets	$	1,203,800		$	903,700
Liabilities and Stockholders' Equity
Accounts payable	$	318,000		$	268,000
Accrued liabilities		49,000			58,000
Income taxes payable		86,000			80,700
Total current liabilities		453,000			406,700
Bonds payable		205,000			118,000
Total liabilities		658,000			524,700
Common stock		331,000			288,000
Retained earnings		214,800			91,000
Total stockholders' equity		545,800			379,000
Total liabilities and stockholders' equity	$	1,203,800		$	903,700

Equipment that had cost $30,100 and on which there was accumulated depreciation of $10,500 was sold during Year 2 for $26,600. 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.