Business combination: Business combination refers to the combining of one or more business organizations in a single entity. The business combination leads to the formation of combined financial statements. After business combination, the entities having separate control merges into one having control over all the assets and liabilities. Mergers and acquisitions are types of business combinations. Direct financing lease: The lessor acquires the assets for leasing so that the revenue can be made from the interest payments. : Records of the acquisition of Company N by Company S.

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Chapter 1, Problem 1.11P

To determine

Business combination:

Business combination refers to the combining of one or more business organizations in a single entity. The business combination leads to the formation of combined financial statements. After business combination, the entities having separate control merges into one having control over all the assets and liabilities. Mergers and acquisitions are types of business combinations.

Direct financing lease:

The lessor acquires the assets for leasing so that the revenue can be made from the interest payments.

:

Records of the acquisition of Company N by Company S.

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