1. Paris Company owns 75% of London Company and 30% of Rome Company. London owns 40% of Rome. The consolidated financial statements of Paris should include:

a. London and Rome

b. London but not Rome

c. Rome but not London

d. Neither Rome or London

e. Either Rome or London

2. Paris Company owns 75% of London Company and 30% of Rome Company. London owns 40% of Rome. This pattern of ownership is called:

a. pyramid ownership

b. indirect affililiation

c. affiliated group

d. connecting affiliation

e. mutual ownership