Patti Corp has several subsidiaries (Aeta, Beta, and Gaeta) that are included in its consolidated financial statements. In its 12/31/16 separate balance sheet, Patti had the following intercompany balances before eliminations:

If cash dividends of $135,000 were paid during the year and the company sold 1,000 shares of common stock at $30 per share, the statement of cash flows would report net cash flow from financing activities as $165,000

Indicate whether the statement is true or false

Darrell owns a parcel of land that is encumbered by a mortgage held by the First National Bank. Darrell agrees to sell the land to Paul for $50,000 . Darrell and Paul together go to the First National Bank to discuss the sale and purchase with the banker. Darrell, Paul, and the banker sign an agreement stating that Paul will assume the mortgage and that Darrell will be discharged from all further

liability on the mortgage. In this case: a. the bank is a third party donee beneficiary. b. the bank can collect from Darrell if Paul defaults. c. Darrell is a third party beneficiary of the agreement between Paul and the bank. d. the agreement among the three is a novation.