Below are Sidebar Corp. 's 2021 income statement and comparative balance sheet at 12/31/2021 and 12/31/2020. Additional information: Investing 1.On December 31, 2020, Sidebar acquired 25 of Island Co.'s common stock for $609,000. On that date, the carrying value of Island's assets and liabilities, which approximated their fair values, was $2,435,000. Island reported income of $319,000 for the year ended December 31, 2021. No dividend income was received by Sidebar on Island's common stock during the year 2021. 319,000* .25 = 74,750 2. During 2020, Sidebar loaned $797,500 to POI Co., an unrelated company. POI made both of the semi-annual principal repayments on time in 2021, at $72,500 each plus interest at 101. POI is current on the lour of December 31, 202T. Reflected Operating 3.On January 2, 2021. Sidebar Gold equipment costing $145,000, wiele a carrying amount of $44.950 for cash. 2 los noncas coa finang 4.On December 31, 2021, Sidebar entered into a finance lease for new equipment. The present value of the annual rental payments is and $1,232,500, which equals the fair value of the property using 71 the known Tessor incremental rate. Sidebar will make the first oL 10 rental payments of $164.000.0 12/2022 The capitalized leased asset under agreement is included 9 Section and Note in Property. Plant Equipment on the balance sheet at 12/31/21. Prussard 5.Sidebar declared and paid cash dividends as follows. footnote Declared Paid Amount 2027 December 15, 2021 February 28, 2020 $145,000 2020 December 15, 2020 February 28, 2021 * $87.000 Required: 1) Prepare a statement of cash flows for Sidebar Corp. for the year ended 12/31/2021, using the indirect method. 2) Explain words and amounts) how the cash low statement will reflect information related to item 4, during 2022. Acumulated Depreciation on Eatmt. Sold! Investment in Island 1, 102,000 209,000 130,500 1 79,750 11, 232,500 698,750 No change Sidebar Corporation Balance Sheet As of 12/31 ... EFFECT Amount ON CASH Cash Accounts receivable Inventory Property, plant, and equipment Accumulated depreciation Investment in Island Co. Loan receivable Total assets 2021 942,500 1,827,000 2,230,100 3,886,000 (1,232,500) 688,750 507,500 8,849,350 change 2020 739,500 1 203,000 1,580,500 + 246,500 1,986,500 1243.6.00 2,556,350 1 (1,102,000) 609,000 652,500 7,022,350 1,319,500 1246,500 108,750 ? 21.750 87,000 158,000 Accounts payable Income taxes payable Dividends payable Capital lease obligation Common stock, $1 par Paid-in capital in excess of par Retained earnings Total liabilities and stockholders' equity 1,566,000 130,500 145,000 1,232,500 580,000 3,045,000 2,150,350 8,849,350 580,000 3,045,000 1,882,100 7,022,350 Sidebar Corporation Income Statement For the year ... Sales Cost of goods sold" Gross profit Loss on equipment sold Investment income (Island Co.) Income tax expense Net Income *Includes depreciation expense of $230.550. 2021 1,377,500 (1,001,950) 375,550 (15,950) 79,750 (26,100) 413,250 CASH FLOWS: Operating = 358,150 Investing = (68,150) Financing (87,000) NOTE: Below are Sidebar Corp. 's 2021 income statement and comparative balance sheet at 12/31/2021 and 12/31/2020. Additional information: Investing 1.On December 31, 2020, Sidebar acquired 25 of Island Co.'s common stock for $609,000. On that date, the carrying value of Island's assets and liabilities, which approximated their fair values, was $2,435,000. Island reported income of $319,000 for the year ended December 31, 2021. No dividend income was received by Sidebar on Island's common stock during the year 2021. 319,000* .25 = 74,750 2. During 2020, Sidebar loaned $797,500 to POI Co., an unrelated company. POI made both of the semi-annual principal repayments on time in 2021, at $72,500 each plus interest at 101. POI is current on the lour of December 31, 202T. Reflected Operating 3.On January 2, 2021. Sidebar Gold equipment costing $145,000, wiele a carrying amount of $44.950 for cash. 2 los noncas coa finang 4.On December 31, 2021, Sidebar entered into a finance lease for new equipment. The present value of the annual rental payments is and $1,232,500, which equals the fair value of the property using 71 the known Tessor incremental rate. Sidebar will make the first oL 10 rental payments of $164.000.0 12/2022 The capitalized leased asset under agreement is included 9 Section and Note in Property. Plant Equipment on the balance sheet at 12/31/21. Prussard 5.Sidebar declared and paid cash dividends as follows. footnote Declared Paid Amount 2027 December 15, 2021 February 28, 2020 $145,000 2020 December 15, 2020 February 28, 2021 * $87.000 Required: 1) Prepare a statement of cash flows for Sidebar Corp. for the year ended 12/31/2021, using the indirect method. 2) Explain words and amounts) how the cash low statement will reflect information related to item 4, during 2022. Acumulated Depreciation on Eatmt. Sold! Investment in Island 1, 102,000 209,000 130,500 1 79,750 11, 232,500 698,750 No change Sidebar Corporation Balance Sheet As of 12/31 ... EFFECT Amount ON CASH Cash Accounts receivable Inventory Property, plant, and equipment Accumulated depreciation Investment in Island Co. Loan receivable Total assets 2021 942,500 1,827,000 2,230,100 3,886,000 (1,232,500) 688,750 507,500 8,849,350 change 2020 739,500 1 203,000 1,580,500 + 246,500 1,986,500 1243.6.00 2,556,350 1 (1,102,000) 609,000 652,500 7,022,350 1,319,500 1246,500 108,750 ? 21.750 87,000 158,000 Accounts payable Income taxes payable Dividends payable Capital lease obligation Common stock, $1 par Paid-in capital in excess of par Retained earnings Total liabilities and stockholders' equity 1,566,000 130,500 145,000 1,232,500 580,000 3,045,000 2,150,350 8,849,350 580,000 3,045,000 1,882,100 7,022,350 Sidebar Corporation Income Statement For the year ... Sales Cost of goods sold" Gross profit Loss on equipment sold Investment income (Island Co.) Income tax expense Net Income *Includes depreciation expense of $230.550. 2021 1,377,500 (1,001,950) 375,550 (15,950) 79,750 (26,100) 413,250 CASH FLOWS: Operating = 358,150 Investing = (68,150) Financing (87,000)