Which of the Following Statements About Dwelling Property 3 (Special

question 21

Multiple Choice

Which of the following statements about Dwelling Property 3 (special form) is (are) true?
I.Personal property is covered on an "open perils" (all risks) basis.
II.The dwelling and other structures are covered only for those perils specifically named in the policy.

• A)I only
• B)II only
• C)both I and II
• D)neither I nor II

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Definitions:

Investment in Subsidiary

Refers to the holding of shares or interests by one company (the parent company) in another company (the subsidiary).

Goodwill

A non-material asset generated from purchasing another company at a cost exceeding the fair market value of its tangible net assets.

Paid-In-Capital Accounts

Accounts representing the funds contributed by shareholders over and above the nominal value of the shares; it's an equity item on the balance sheet.

Consolidating Journal Entry

A journal entry made in the process of combining the financial statements of several departments or subsidiaries into a single set of statements.