Which of the following statements is true regarding the preparation of consolidated financial statements under U.S. GAAP?

I. A parent company with a December 31 year-end is able to consolidate operations with a subsidiary that has an August 31 year end.

II. If company A owns 60% of Company B, and Company B owns 60% of Company C, none of Company Cs activity will be included in Company As consolidated financial statements since the effective ownership is less than 50%.

a. I only

b. II only

c. Both I and II

d. Neither I nor II