What is the major reason why a company may avoid consolidating another company?

1) Consolidation adds assets, reducing return on assets.

2) Consolidation increases leverage.

3) Consolidation is costly, since the other company's account balances are hard to find

4) Consolidation reduces total profits, due to the additional expenses reported by the other company.

Which statement is true regarding consolidation eliminations at the date of acquisition?

1)If the subsidiary has net accumulated other comprehensive losses, elimination E debits the subsidiary 's AOCI.

2)Elimination R never credits the subsidiary's assets.

3)Elimination E always debits the subsidiary's retained earnings balance.

4)If the subsidiary's debt is undervalued elimination R will create more goodwill.