1)In a business combination, the direct costs of registering and issuing equity securities are:

Select one:

a.Added to the parent companys investment account.

b.Deducted from the income of the current period.

c.Charged against other paid-in capital of the combined entity.

d.Included in the expenses of the period of the acquisition.

e.Added to the income in the current period.

2)

Salt Company has a receivable from its parent, Pepper Company. Should this receivable be separately reported in Salts balance sheet and in Peppers consolidated balance sheet?

Salts Peppers consolidated

balance sheet balance sheet

Select one:

a. Salts Peppers consolidated

balance sheet balance sheet

Yes No

b. Salts Peppers consolidated

balance sheet balance sheet

Yes Yes

c. Salts Peppers consolidated

balance sheet balance sheet

No No

d. Salts Peppers consolidated

balance sheet balance sheet

No Yes

3)Pepper Corporation owns 90% of the outstanding voting stock of Salt Company and Nike Corporation owns the remaining 10% of Salts voting stock. On the consolidated financial statements of Pepper Corporation and Subsidiary, Nike is:

Select one:

a.An affiliate

b.A non-controlling interest

c.An associate

d.An equity investee