iMac M4 not showing up in MacBook Air M3 Finder

Just bought a new iMac M4 and cannot get it to appear in the Finder sidebar (locations tab) of my MacBook Air M3 as a shared device. The iMac can see the MacBook in its sidebar locations and access all the files but the MacBook can only see the iMac via the Network location tab in the finder sidebar but when connected, shared files and the contents of an external backup disk, which is connected to the iMac, do not appear. File Sharing is on for both machines + full disk access. Both are on the same network and logged in to same Apple account. Full file and disk sharing between my previous iMac (2019) and MacBook worked just fine. Hoping someone has an easy answer to a non-IT specialist user.