1. Which of the following does not represent a primary motivation for business combinations? a. Combinations as a vehicle for achieving rapid growth and competitiveness. b. Cost savings through...

1. Which of the following does not represent a primary motivation for business combinations? a. Combinations as a vehicle for achieving rapid growth and competitiveness. b. Cost savings through elimination of duplicate facilities and staff. c. Quick entry for new and existing products into markets. d. Larger firms being less likely to fail. 2. Which of the following is the best theoretical justification for consolidated financial statements? a. In form the companies are one entity; in substance they are separate. b. In form the companies are separate; in substance they are one entity. c. In form and substance the companies are one entity. d. In form and substance the companies are separate. 3. What is a statutory merger? a. A merger approved by the Securities and Exchange Commission. b. An acquisition involving the purchase of both stock and assets. c. A takeover completed within one year of the initial tender offer. d. A business combination in which only one company continues to exist as a legal entity. 4. What is the appropriate accounting treatment for the value assigned to in-process research and development acquired in a business combination? a. Expense upon acquisition. b. Capitalize as an asset. c. Expense if there is no alternative use for the assets used in the research and development and technological feasibility has yet to be reached. d. Expense until future economic benefits become certain and then capitalize as an asset. 5. An acquir