Exam (elaborations) TEST BANK Advanced Accounting Part 2 ZEUS VERNON B. MILLAN 2015 Edition

Exam (elaborations) TEST BANK Advanced Accounting Part 2 ZEUS VERNON B. MILLAN 2015 Edition TEST BANK Advanced Accounting Part 2 ZEUS VERNON B. MILLAN ii ALL RIGHTS RESERVED 2015 No part of this work covered by the copyright hereon may be reproduced or used in any form or by any means - electronic or mechanical, including photocopying – without the written permission of the author. ISBN 978-621-95096-5-7 Published by: BANDOLIN ENTERPRISE No. 100 Montebello Village, Bakakeng Sur, Baguio City 2600, Philippines iii TABLE OF CONTENTS CHAPTER 13 BUSINESS COMBINATIONS (PART 1) ..................................... 1 OVERVIEW ON THE TOPIC ........... ERROR! BOOKMARK NOT DEFINED. INTRODUCTION ............................ ERROR! BOOKMARK NOT DEFINED. OBJECTIVE .................................... ERROR! BOOKMARK NOT DEFINED. SCOPE ........................................... ERROR! BOOKMARK NOT DEFINED. DEFINITION OF BUSINESS COMBINATIONERROR! BOOKMARK NOT DEFINED. Essential elements in the definition of a business combination Error! Bookmark not defined. ACCOUNTING FOR BUSINESS COMBINATIONERROR! BOOKMARK NOT DEFINED. IDENTIFYING THE ACQUIRER ...... ERROR! BOOKMARK NOT DEFINED. DETERMINING THE ACQUISITION DATEERROR! BOOKMARK NOT DEFINED. RECOGNIZING AND MEASURING GOODWILLERROR! BOOKMARK NOT DEFINED. Consideration transferred Error! Bookmark not defined. Non-controlling interest ... Error! Bookmark not defined. Previously held equity interest in the acquireeError! Bookmark not defined. Net identifiable assets acquiredError! Bookmark not defined. RESTRUCTURING PROVISIONS .... ERROR! BOOKMARK NOT DEFINED. SPECIFIC RECOGNITION PRINCIPLESERROR! BOOKMARK NOT DEFINED. 1. Operating leases .......... Error! Bookmark not defined. 2. Intangible assets .......... Error! Bookmark not defined. EXCEPTION TO THE RECOGNITION PRINCIPLE – CONTINGENT LIABILITIES ERROR! BOOKMARK NOT DEFINED. EXCEPTIONS TO BOTH THE RECOGNITION AND MEASUREMENT PRINCIPLES ERROR! BOOKMARK NOT DEFINED. Additional concepts on Consideration transferredError! Bookmark not defined. EXCEPTIONS TO THE MEASUREMENT PRINCIPLEERROR! BOOKMARK NOT DEFINED. CHAPTER 13: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 13: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 13: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ................................................................................................ 1 CHAPTER 13: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 14 BUSINESS COMBINATIONS (PART 2) ..................................... 8 SHARE-FOR-SHARE EXCHANGES ERROR! BOOKMARK NOT DEFINED. BUSINESS COMBINATION ACHIEVED IN STAGESERROR! BOOKMARK NOT DEFINED. BUSINESS COMBINATION ACHIEVED WITHOUT TRANSFER OF CONSIDERATION ERROR! BOOKMARK NOT DEFINED. MEASUREMENT PERIOD .............. ERROR! BOOKMARK NOT DEFINED. DETERMINING WHAT IS PART OF THE BUSINESS COMBINATION TRANSACTION ERROR! BOOKMARK NOT DEFINED. Reacquired rights ................ Error! Bookmark not defined. Settlement of pre-existing relationships between the acquirer and acquiree ..................................................... Error! Bookmark not defined. SUBSEQUENT MEASUREMENT AND ACCOUNTINGERROR! BOOKMARK NOT DEFINED. DISCLOSURES ............................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 14: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 14: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. iv CHAPTER 14: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ................................................................................................ 8 CHAPTER 14: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 15 BUSINESS COMBINATIONS (PART 3) ................................... 16 SPECIAL ACCOUNTING TOPICS FOR BUSINESS COMBINATIONERROR! BOOKMARK NOT DEFINED. GOODWILL ................................... ERROR! BOOKMARK NOT DEFINED. Due diligence ......................... Error! Bookmark not defined. Methods of estimating goodwillError! Bookmark not defined. REVERSE ACQUISITIONS .............. ERROR! BOOKMARK NOT DEFINED. COMBINATION OF MUTUAL ENTITIESERROR! BOOKMARK NOT DEFINED. CHAPTER 15: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 15: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 15: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 16 CHAPTER 15: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 15: THEORY OF ACCOUNTS REVIEWER ............................. 19 CHAPTER 15 - SUGGESTED ANSWERS TO THEORY OF ACCOUNTS QUESTIONS 25 CHAPTER 16 CONSOLIDATED FINANCIAL STATEMENTS (PART 1) .... 26 OVERVIEW ON THE TOPIC ........... ERROR! BOOKMARK NOT DEFINED. SCOPE ........................................... ERROR! BOOKMARK NOT DEFINED. CONTROL ...................................... ERROR! BOOKMARK NOT DEFINED. POWER ......................................... ERROR! BOOKMARK NOT DEFINED. Administrative rights ......... Error! Bookmark not defined. Unilateral rights ................... Error! Bookmark not defined. Protective rights ................... Error! Bookmark not defined. Substantive rights ............... Error! Bookmark not defined. Voting rights .......................... Error! Bookmark not defined. Substantive removal and other rights held by other parties Error! Bookmark not defined. EXPOSURE OR RIGHTS TO VARIABLE RETURNSERROR! BOOKMARK NOT DEFINED. ABILITY TO USE ITS POWER TO AFFECT INVESTOR’S RETURNSERROR! BOOKMARK NOT DEFINED. ACCOUNTING REQUIREMENTS .... ERROR! BOOKMARK NOT DEFINED. Uniform accounting policiesError! Bookmark not defined. Reporting date ...................... Error! Bookmark not defined. Consolidation period .......... Error! Bookmark not defined. Measurement ......................... Error! Bookmark not defined. NON-CONTROLLING INTERESTS (NCI)ERROR! BOOKMARK NOT DEFINED. PREPARING THE CONSOLIDATED FINANCIAL STATEMENTSERROR! BOOKMARK NOT DEFINED. CONSOLIDATION AT DATE OF ACQUISITIONERROR! BOOKMARK NOT DEFINED. CONSOLIDATION SUBSEQUENT TO DATE OF ACQUISITIONERROR! BOOKMARK NOT DEFINED. Step 1: Analysis of effects of intercompany transactionError! Bookmark not defined. Step 2: Analysis of net assetsError! Bookmark not defined. Step 3: Goodwill computationError! Bookmark not defined. Step 4: Non-controlling interest in net assetsError! Bookmark not defined. Step 5: Consolidated retained earningsError! Bookmark not defined. Step 6: Consolidated profit or lossError! Bookmark not defined. v Step 7: Profit or loss attributable to owners of parent and NCI Error! Bookmark not defined. SUBSIDIARY’S OUTSTANDING CUMULATIVE PREFERENCE SHARESERROR! BOOKMARK NOT DEFINED. CHAPTER 16: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 16: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 16: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 26 CHAPTER 16: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 17 CONSOLIDATED FINANCIAL STATEMENTS (PART 2) .... 31 INTERCOMPANY TRANSACTIONS ERROR! BOOKMARK NOT DEFINED. Intercompany sale of inventoryError! Bookmark not defined. Intercompany sale of property, plant and equipmentError! Bookmark not defined. Intercompany dividends ... Error! Bookmark not defined. Intercompany bond transactionError! Bookmark not defined. CHAPTER 17: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 17: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 31 CHAPTER 18 CONSOLIDATED FINANCIAL STATEMENTS (PART 3) .... 35 IMPAIRMENT OF GOODWILL ....... ERROR! BOOKMARK NOT DEFINED. INTERCOMPANY ITEMS IN-TRANSIT AND RESTATEMENTSERROR! BOOKMARK NOT DEFINED. CONTINUOUS ASSESSMENT ......... ERROR! BOOKMARK NOT DEFINED. Changes in ownership interest not resulting to loss of control Error! Bookmark not defined. Loss of control ....................... Error! Bookmark not defined. Derecognition of other comprehensive incomeError! Bookmark not defined. IMPORTANCE OF CONSOLIDATIONERROR! BOOKMARK NOT DEFINED. THEORIES OF CONSOLIDATION ... ERROR! BOOKMARK NOT DEFINED. Historical background ....... Error! Bookmark not defined. Advantages and disadvantages of the entity theoryError! Bookmark not defined. ADDITIONAL ILLUSTRATIONS: .... ERROR! BOOKMARK NOT DEFINED. CONSOLIDATION OF REVERSE ACQUISITIONERROR! BOOKMARK NOT DEFINED. SPECIAL PURPOSE ENTITIES ....... ERROR! BOOKMARK NOT DEFINED. CHAPTER 18: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 18: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 18: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 35 CHAPTER 19 CONSOLIDATED FINANCIAL STATEMENTS (PART 4) .... 47 COMPLEX GROUP STRUCTURES .. ERROR! BOOKMARK NOT DEFINED. Identifying the acquisition dateError! Bookmark not defined. Consolidation of a vertical groupError! Bookmark not defined. Consolidation of a D-shaped (mixed) groupError! Bookmark not defined. Complex group structure with AssociateError! Bookmark not defined. INVESTMENT IN SUBSIDIARY MEASURED AT OTHER THAN COSTERROR! BOOKMARK NOT DEFINED. vi PUSH-DOWN ACCOUNTING ......... ERROR! BOOKMARK NOT DEFINED. PFRS 12 DISCLOSURE OF INTERESTS IN OTHER ENTITIESERROR! BOOKMARK NOT DEFINED. CHAPTER 19: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 19: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 47 CHAPTER 19: THEORY OF ACCOUNTS REVIEWER ............................. 53 CHAPTER 19 - SUGGESTED ANSWERS TO REVIEW THEORY QUESTIONS56 CHAPTER 20 SEPARATE FINANCIAL STATEMENTS .................................. 57 OBJECTIVE .................................... ERROR! BOOKMARK NOT DEFINED. SCOPE ........................................... ERROR! BOOKMARK NOT DEFINED. DEFINITIONS ................................ ERROR! BOOKMARK NOT DEFINED. PREPARATION OF SEPARATE FINANCIAL STATEMENTSERROR! BOOKMARK NOT DEFINED. COST METHOD ............................. ERROR! BOOKMARK NOT DEFINED. FAIR VALUE METHOD .................. ERROR! BOOKMARK NOT DEFINED. EQUITY METHOD ......................... ERROR! BOOKMARK NOT DEFINED. DISCLOSURE ................................. ERROR! BOOKMARK NOT DEFINED. CHAPTER 20: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 20: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 57 CHAPTER 20: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 20: THEORY OF ACCOUNTS REVIEWER ............................. 57 CHAPTER 20 - SUGGESTED ANSWERS TO REVIEW THEORY QUESTIONS58 CHAPTER 21 THE EFFECTS OF CHANGES IN FOREIGN EXCHANGE RATES 59 OBJECTIVE .................................... ERROR! BOOKMARK NOT DEFINED. Two ways of conducting foreign activitiesError! Bookmark not defined. Two main accounting issuesError! Bookmark not defined. SCOPE ........................................... ERROR! BOOKMARK NOT DEFINED. FUNCTIONAL CURRENCY ............. ERROR! BOOKMARK NOT DEFINED. CHANGE IN FUNCTIONAL CURRENCYERROR! BOOKMARK NOT DEFINED. FOREIGN CURRENCY TRANSACTIONSERROR! BOOKMARK NOT DEFINED. Initial recognition ............... Error! Bookmark not defined. Subsequent measurement Error! Bookmark not defined. Monetary items ..................... Error! Bookmark not defined. Direct and indirect quotationError! Bookmark not defined. RECOGNITION OF EXCHANGE DIFFERENCESERROR! BOOKMARK NOT DEFINED. ITEMS MEASURED AT OTHER THAN HISTORICAL COSTERROR! BOOKMARK NOT DEFINED. SEVERAL EXCHANGE RATES ........ ERROR! BOOKMARK NOT DEFINED. EXCHANGE DIFFERENCES RECOGNIZED IN OCIERROR! BOOKMARK NOT DEFINED. FOREIGN OPERATIONS ................ ERROR! BOOKMARK NOT DEFINED. Translation to the presentation currencyError! Bookmark not defined. Translation procedures..... Error! Bookmark not defined. Translation of a foreign operationError! Bookmark not defined. Net investment in a foreign operationError! Bookmark not defined. Disposal or partial disposal of a foreign operationError! Bookmark not defined. HYPERINFLATIONARY ECONOMY ERROR! BOOKMARK NOT DEFINED. Translation procedures – Hyperinflationary economyError! Bookmark not defined. DISCLOSURE ................................. ERROR! BOOKMARK NOT DEFINED. CHAPTER 21: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. vii CHAPTER 21: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 21: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 59 CHAPTER 21: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) 68 CHAPTER 21: THEORY OF ACCOUNTS REVIEWER ............................. 76 CHAPTER 21 - SUGGESTED ANSWERS TO REVIEW THEORY QUESTIONS84 CHAPTER 22 ACCOUNTING FOR DERIVATIVES AND HEDGING TRANSACTIONS (PART 1) ............................................ ERROR! BOOKMARK NOT DEFINED. OVERVIEW ON THE TOPIC ........... ERROR! BOOKMARK NOT DEFINED. INTRODUCTION ............................ ERROR! BOOKMARK NOT DEFINED. PURPOSE OF DERIVATIVES .......... ERROR! BOOKMARK NOT DEFINED. Risks ........................................... Error! Bookmark not defined. DEFINITION OF A DERIVATIVE .... ERROR! BOOKMARK NOT DEFINED. COMMON TYPES OF DERIVATIVESERROR! BOOKMARK NOT DEFINED. MEASUREMENT OF DERIVATIVESERROR! BOOKMARK NOT DEFINED. NO HEDGING DESIGNATION ........ ERROR! BOOKMARK NOT DEFINED. HEDGING ...................................... ERROR! BOOKMARK NOT DEFINED. Hedging instrument............ Error! Bookmark not defined. Hedged items ......................... Error! Bookmark not defined. HEDGE ACCOUNTING ................... ERROR! BOOKMARK NOT DEFINED. Hedging relationships........ Error! Bookmark not defined. FAIR VALUE HEDGES .................... ERROR! BOOKMARK NOT DEFINED. CASH FLOW HEDGES .................... ERROR! BOOKMARK NOT DEFINED. HEDGES OF A NET INVESTMENT IN A FOREIGN OPERATIONERROR! BOOKMARK NOT DEFINED. CHAPTER 22: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 22: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 22: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 23 ACCOUNTING FOR DERIVATIVES AND HEDGING TRANSACTIONS (PART 2) .......................................................................................................... 85 ACCOUNTING FOR FORWARD CONTRACTSERROR! BOOKMARK NOT DEFINED. Illustration 1: Fair value hedge of a recognized assetError! Bookmark not defined. Illustration 2: No hedging designation (Held for speculation) Error! Bookmark not defined. Illustration 3: Fair value hedge of a recognized liabilityError! Bookmark not defined. Illustration 4: No hedging designation (Held for speculation) Error! Bookmark not defined. FAIR VALUE HEDGE OF AN UNRECOGNIZED FIRM COMMITMENTERROR! BOOKMARK NOT DEFINED. Illustration 5: Fair value hedge of a firm sale commitmentError! Bookmark not defined. Illustration 6: Fair value hedge of a firm purchase commitment Error! Bookmark not defined. Illustration 7: FV hedge - firm purchase commitment (Present value) ..................................................... Error! Bookmark not defined. Illustration 8: FV hedge - firm purchase commitment (Present value) ..................................................... Error! Bookmark not defined. FAIR VALUE HEDGE VS. CASH FLOW HEDGEERROR! BOOKMARK NOT DEFINED. viii FIRM COMMITMENT VS. FORECAST TRANSACTIONERROR! BOOKMARK NOT DEFINED. CHOICE TO DESIGNATE AS EITHER FAIR VALUE HEDGE OR CASH FLOW HEDGE ERROR! BOOKMARK NOT DEFINED. SUBSEQUENT ACCOUNTING FOR ACCUMULATED OCI IN CASH FLOW HEDGE ERROR! BOOKMARK NOT DEFINED. Illustration 9: Cash flow hedge – forecasted purchase transaction Error! Bookmark not defined. Illustration 10: Cash flow hedge of a forecasted sale transaction – Present value (Indirect quotation) ........... Error! Bookmark not defined. Illustration 11: CF hedge of a recognized liability – Present value Error! Bookmark not defined. CHAPTER 23: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 23: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 85 CHAPTER 23: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 24 ACCOUNTING FOR DERIVATIVES AND HEDGING TRANSACTIONS (PART 3) .......................................................................................................... 93 ACCOUNTING FOR FUTURES CONTRACTERROR! BOOKMARK NOT DEFINED. Illustration 1: No hedging designationError! Bookmark not defined. Illustration 2: FV hedge of a recognized asset measured at fair value Error! Bookmark not defined. Illustration 3: FV hedge of a recognized asset measured at LOCON Error! Bookmark not defined. Illustration 4: Fair value hedge of a firm sale commitmentError! Bookmark not defined. CASH FLOW HEDGE – SPECIFIC ACCOUNTINGERROR! BOOKMARK NOT DEFINED. Illustration 5: CF hedge – Assessment of Hedge effectiveness Error! Bookmark not defined. ACCOUNTING FOR OPTIONS ........ ERROR! BOOKMARK NOT DEFINED. Illustration 1: Fair value hedge of a recognized asset – Put option Error! Bookmark not defined. Illustration 2: No hedging designation – Call optionError! Bookmark not defined. Illustration 3: CF hedge - forecasted transaction (Indirect quotation) ..................................................... Error! Bookmark not defined. ACCOUNTING FOR SWAPS ........... ERROR! BOOKMARK NOT DEFINED. Illustration 1: CF hedge - variable-rate debt (Payment at maturity) Error! Bookmark not defined. Illustration 2: CF hedge - variable-rate debt (Periodic payments) Error! Bookmark not defined. FAIR VALUE HEDGE – HEDGED ITEM IS MEASURED AT AMORTIZED COST ERROR! BOOKMARK NOT DEFINED. Illustration 3: Fair value hedge of a fixed-rate debtError! Bookmark not defined. CHAPTER 24: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) ............................................................................................. 93 CHAPTER 24: EXERCISES (FOR CLASSROOM INSTRUCTION PURPOSES) ERROR! BOOKMARK NOT DEFINED. CHAPTER 25 ACCOUNTING FOR DERIVATIVES AND HEDGING TRANSACTIONS (PART 4) ....................................................................................................... 101 ix ACCOUNTING FOR NET INVESTMENT HEDGESERROR! BOOKMARK NOT DEFINED. Illustration: Hedge of a net investment in foreign operation Error! Bookmark not defined. EMBEDDED DERIVATIVES ........... ERROR! BOOKMARK NOT DEFINED. Hybrid contracts with financial asset hostsError! Bookmark not defined. Separation of embedded derivative from host contractError! Bookmark not defined. ADDITIONAL ILLUSTRATIONS: .... ERROR! BOOKMARK NOT DEFINED. CHAPTER 25: SUMMARY ............ ERROR! BOOKMARK NOT DEFINED. CHAPTER 25: MULTIPLE CHOICE – THEORY (FOR CLASSROOM INSTRUCTION PURPOSES) ....................................................... ERROR! BOOKMARK NOT DEFINED. CHAPTER 25: MULTIPLE CHOICE – COMPUTATIONAL (FOR CLASSROOM INSTRUCTION PURPOSES) .......................................................................................... 101 CHAPTER 25: THEORY OF ACCOUNTS REVIEWER .......................... 106 CHAPTER 25 - SUGGESTED ANSWERS TO THEORY OF ACCOUNTS QUESTIONS 126 CHAPTER 26 CORPORATE LIQUIDATION AND REORGANIZATION