Use the following to answer questions 7-9: A parent and its subsidiary enter into a number of leases with one another. When preparing consolidated financial statements, the appropriate treatment of the following types of leases must be determined. I - Operating Leases II - Direct Financing Leases MI - Sales-type Leases 7. Consider the information given above. Of the types of leases listed, which one(s) necessitate the elimination of rent expense and rental income for consolidation purposes? A) I only. B) II only. C) I and II. D) III only. 8. Consider the information given above. Of the types of leases listed, which one(s), when preparing consolidated financial statements, necessitate the elimination of profit realized on the lease transaction? A) I only. B) II only. III only. D) II and III. 9. Consider the information given above. Of the types of leases listed, which one(s) necessitate the elimination of interest expense and interest income when preparing consolidated financial statements? A) I only. II only. C) III only. D) II and M. B)