Cascade 128 weskit vest pattern

I am having trouble with this pattern. I have knit to the armholes and placed the front 78 stitches on a holder. Now I’m following the back pattern:
"…working on the 78 stitches …bo 4 sts. at beginning of next two rows…"
So now I am no longer working in the round, but back and forth?
Also when I start working on these 78 stitches, the front stitches (on holder) and the back become joined. Or do I cut the yarn and start fresh with the back?

I should have said :the working yarn is connected from end of back to beginning of back,"
Maybe I am supposed to cut it and start knitting with a new yarn?

Yes, you will be working flat (back and forth) now. You need a separate yarn for the back so you can cut the yarn or use the other end of the same ball or start with a new ball.