1. When a corporate investor makes investments in equity securities in an investee company, what the investor company can expect and gain from the investment are limited to cash dividends and/or stock dividends. a) True b) False 2. When an investor company buys around 10% of voting shares of stock in another company, the investor company, most of the time, accounts for this transaction by fair value method. a) True b) False 3. If 35% ownership of a company is sold to an investment company, the investment company would account for this purchase of ownership by equity method. a) True b) False 4. Consolidation of financial statements, when applicable, is to serve external reporting requirements, while the consolidated financial statements have no accounting imelination Focus