Pryor Company acquired 51,000 shares of Spero Company’s common stock on January 1, 2023, for $408,000 when Spero Company had common stock ($5 par) of $300,000 and retained earnings of $200,000. On January 1, 2025, Spero Company issued 15,000 additional shares of its common stock for $8.50 per share. The new shares were purchased entirely by Pryor Company. Spero Company’s retained earnings had increased to $360,000 by that date. During 2025, Spero Company declared dividends of $40,000 and reported net income at year- end of $90,000. Pryor Company uses the cost method. Assume that any difference between implied and book values relates to subsidiary land.

Required:
A. Prepare the journal entry on Pryor’s books to record the purchase of the new shares.
B. Prepare in general journal form the workpaper entries needed for the preparation of a consolidated statements workpaper on December 31, 2025.