The 2021 and 2020 balance sheets of Waterside Corporation follow. The 2021 income statement is also provided. Waterside had no noncash investing and financing transactions during 2021. During the year, the company sold equipment for $15,400, which had originally cost $13,400 and had a book value of $10,700. The company did not issue any notes payable during the year but did issue common stock for $32,000. The company purchased plant assets and long-term investments with cash (Click the icon to view the income statement.) (Click the icon to view the balance sheets.) Requirements 1. Prepare the statement of cash flows for Waterside Corporation for 2021 using the indirect method. 2. Evaluate the company's cash flows for the year. Discuss each of the categories of cash flows in your response. Operating Activities: Adjustments to reconcile net income to cash basis: Income Statement 1 2 3 4 Sales revenues A Waterside Corporation Income Statement B C For the Year Ended December 31, 2021 5 Less: Cost of goods sold $ 348,000 73,000 $ 275,000 6 Gross profit 7 Less operating expenses: 8 Salaries and wages expense $ 28,000 9 Depreciation expense 6,000 10 Other operating expenses 14,500 11 Total operating expenses $ 48,500 12 Operating income $ 226,500 13 Plus other income and less other expenses: 14 Interest expense AE Cain analDDER $ 9,200 4.700 Income Statement QUICS TOVCHINGS 5 Less: Cost of goods sold 6 Gross profit 7 Less operating expenses: Salaries and wages expense Depreciation expense 8 9 10 Other operating expenses 11 Total operating expenses 12 Operating income 13 Plus other income and less other expenses: 14 Interest expense 15 Gain on sale of PP&E 16 Total other income and expenses 17 Income before income taxes 18 Less: Income tax expense 19 Net income EA $ $ 69 040,000 73,000 $275,000 28,000 6,000 14,500. 69 $ 9,200 4,700 48,500 $ 226,500 X 4,500 $ 222,000 36,900 $ 185,100 Balance Sheets Assets 4 5 Current assets: 6 Cash 7 Accounts receivable 8 Inventory 9 Prepaid insurance 10 Total current assets 11 12 Property, plant, and equipment 13 Less: Accumulated depreciation 14 Investments 15 Total assets 16 17 18 Current liabilities: 19 Accounts payable Liabilities 2021 2020 $ 50,500 $ 23,500 31,900 29,700 86,500 93,100 3,500 2,400 $ 172,400 $ 148,700 158,000 137,000 (30,600) (27,300) 116,000 0 $ 415,800 $ 258,400 69 $ 33,500 $ 36,700 X Balance Sheets 19 Accounts payable 20 Wages payable 33,500 30,700 3,000 7,500 21 Interest payable 2,800 0 22 Income taxes payable 6,100 0 23 Other accrued expenses payable 18,800 22,700 24 Total current liablities $ 64,200 $ 66,900 25 26 Long-term liabilities 27 Total liabilities 28 29 Stockholders' equity 30 Common stock 31 Retained earnings 32 Total stockholders' equity 33 S 71,000 112,000 135,200 $ 178,900 69 106,000 74,000 174,600 5,500 280,600 $ 79,500 34 Total liabilities and equity $ 415,800 $ 258,400