Dorsey Corporation purchased 90% of the common stock of Lansing Company on January 1, 2008. The cost of the investment was equal to the book value interest acquired. Lansing Company operates two retail stores and an exporting business in London that specializes in buying and selling British tweeds. The subsidiary provided the following financial statements in pounds to the parent company: LANSING COMPANY Consolidated Income and Retained Earnings Statement for the Year Ended December 31, 2019 Sales Cost of Goods Sold Depreciation Expense Other Expenses Net Income 2,900,000 (1,400,000) (300,000) (400,000) 800,000 1/1 Retained Earnings 900,000 1,700,000 Less: Dividends Declared and Paid, December 31 (325,000) 12/31 Retained Earnings 1.375.000 LANSING COMPANY Balance Sheet December 31, 2019 Cash and Receivables 1,275,000 Merchandise Inventory 490,000 Property, Plant, and Equipment 3,450,000 Total 5,215,000 Current Liabilities 640,000 Long-Term Notes Payable 1,200,000 Capital Stock 2,000,000 Retained Earnings 1,375,000 Total 5,215,000 Lansing Company was incorporated on January 1, 2006, at which time all the property, plant, and equipment was purchased. The long-term notes were issued to partially finance the purchase of the fixed assets.