2. The 2016 income statement of Salem Company follows: SALEM COMPANY Consolidated Statements of Operations In thousands) For the Years Ended December 31 201 201 les roduct ervice inancing $393,218 42,130 10,002 445,350 $472,14 50,7 9,98 532 ost of sales roduct rvice Financing 370,47 39,061 5,97 315,498 29,98 7,28 415,512352,776 Gross margin 117,326 42,57 Selling, general and administrative expenses ncome (loss) from operations 33,42 59,14 52,06 nterest and other income (expense) nterest and other income Equity income from Portland Co., including gain on sale 18,9 13,702 Interest expense Interest and other income (expense), net 418 ncome (loss) before income taxes ncome tax expense et income (loss) 18,3 83,641 17,56 13,34 72,4 15,22 Required What accounting method does Salem use to account for its investments in Portland Co.? According to GAAP, when must Salem account for its investments in affiliates by consolidating their financial statements? b