On January 1, 2020, Wildhorse Inc. paid $690,000 for 10,000 shares of Sheffield Companys voting common stock, which was a 10% interest in Sheffield. Wildhorse does not have the ability to exercise significant influence over the operating and financial policies of Sheffield. Wildhorse received dividends of $1.60 per share from Sheffield on October 1, 2020. Sheffield reported net income of $557,000 for the year ended December 31, 2020. The cost and fair value of Genso common stock was the same at December 31, 2020. On July 1, 2021, Wildhorse paid $2,309,000 for 30,000 additional shares of Sheffield Companys voting common stock, which represents an additional 30% investment in Sheffield. As a result of this transaction, Wildhorse has the ability to exercise significant influence over the operating and financial policies of Sheffield. Wildhorse received dividends of $1.90 per share from Sheffield on April 1, 2021, and $2.50 per share on October 1, 2021. Sheffield reported net income of $638,000 for the year ended December 31, 2021, and $351,000 for the 6 months ended December 31, 2021. (For both purchases, assume any excess of cost over book value is due to goodwill.) (a) Prepare a schedule showing the income or loss before income taxes for the year ended December 31, 2020, that Wildhorse should report from its investment in Sheffield in its income statement issued in March 2021.

(b) During March 2022, Wildhorse issues comparative financial statements for 2020 and 2021. Prepare schedules showing the income or loss before income taxes for the years ended December 31, 2020 and 2021, that Wildhorse should report from its investment in Sheffield.