Determine whether the following items qualify as a change in reporting entity. If the change qualifies as a change in reporting entity, indicate the appropriate accounting treatment. Item 1: A subsidiary that previously was not consolidated now meets the criteria for consolidation. With the change, the subsidiary financial statements are now consolidated with the parent company's financial statements. Change in reporting entity? Accounting Treatment: Item 2: A newly purchased company is consolidated with the purchaser's other existing subsidiaries to report as a single entity. Change in reporting entity? Accounting Treatment: