Pairy Corporation acquired a 100% interest in Sent Company on January 1, 2009, paying$140,000. Financial statement data for the two companies for the year ended December 31, 2009follow: Imam Stale-Men: PM 321;!Sales $4?6,[I]0 31 54,500Cost of goods sold 235,600 121,000Other expense 45,500 29,500Dividend income 5,500 —0—Retained Earnings Statement Balance, 1 f 1 75,030 10,500Net income 143,400 4,000Dividends declared 17,500 3,500Bela are Sim-t Cash 84,400 29,000Accounts receivable 70,000 56,500Inventory 49,500 30,500Investment in Sen: Company 1440,1200 —0—Land 4,010 12,000Accounts payable 211,010 14,000Common stock 120,030 100,000Retained earnings 206,000 90,0110Required: A. What method is being used by Parry to account for its investment in Sent Company?How can you tell? B. Prepare a workpaper for the preparation of consolidated ?nancial statements onDecember 31, 2009. Any difference between the book value of equity acquired and thevalue implied by the purchase price relates to subsidiary land.