Which of the following is NOT true with regard to the statutory consolidation form of business combination? O The combining entities both cease to exist after the combination. O Control of the net assets of the combining entities must be acquired by the new entity. O The net assets of the combining entities must be acquired with assets of the new corporation. O A new corporation must be formed.
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- Which of the following is NOT true with regard to the statutory consolidation form of business combination? a. The combining entities both cease to exist after the combination. b. A new corporation must be formed. c. Control of the net assets of the combining entities must be acquired by the new entity. d. The net assets of the combining entities must be acquired with assets of the new corporation.Which of the following situations best describes a business combination to be accounted for as a statutory merger? Select one: a. Two companies combine to form a new third company, and the original two companies are dissolved. b. One company transfers assets to another company it has created c. Both companies in a combination continue to operate as separate, but related, legal entities. d. Only one of the combining companies survives and the other loses its separate identityconsolidation occurs when one corporation takes over all the operations of another business entity, and that entity is dissolved Select one: True False
- A merger occurs when one corporation takes over all the operations of another business entity, and that entity is dissolved. Select one: True FalseWhat will be the liability of the corporation as to themselves and to third person in case of merger and consolidation.Which of the following is not true with regard to a business combination accomplished in the form of a stock acquisition? a. Two companies remain in existence after the combination b. A parent-subsidiary relationship is said to exist c. Consolidated financial statements are normally required d. All of the above statements are true
- A parent-subsidiary relationship is formed when: A. The acquirer firm is dissolved. B. The acquired firm is not dissolved. C. Both acquirer and acquired firms are dissolved. D. The acquired firm is dissolved.If a corporation merges, what company's articles of incorporation and bylaws will be used?Which of the following is not a true statement with regard to a merger? a. one entity continues to exist b. one entity ceases to exist c. the name of the new entity is not the same as either of the entities d. the name of the new entity is the same as either of the the entities
- Which of the following pertaining to Consolidated Financial Statements is correct?A. The preparation of Consolidated Financial Statements means that the companiesinvolved cease to operate as separate legal entities.B. The preparation of Consolidated Financial Statements is at the Parent Company'sdiscretion.C. When one company has control over another, Consolidated Financial Statementsmust be prepared for the combined entity.D. Before preparing Consolidated Financial Statements, a subsidiary's FinancialStatements prior to the date of acquisition must be restated.Choose the correct. What is a basic premise of the acquisition method regarding accounting for noncontrolling interest?a. Consolidated financial statements should be primarily for the benefit of the parent company’s stockholders.b. Consolidated financial statements should be produced only if both the parent and the subsidiary are in the same basic industry.c. A subsidiary is an indivisible part of a business combination and should be included in its entirety regardless of the degree of ownership.d. Consolidated financial statements should not report a noncontrolling interest balance because these outside owners do not hold stock in the parent company.Following the completion of a business combination in the form of a statutory consolidation, what is the balance in the new corporation’s Retained earnings account? A. The sum of the acquirer and acquiree retained earnings account balances. B. The acquirer retained earnings account balance C. Zero D. The acquiree retained earnings account balance