Shareholders in Boxer Corporation Exchange All of Their Nonvoting Class

question 33

Multiple Choice

Shareholders in Boxer Corporation exchange all of their nonvoting Class B common stock for additional shares of Boxer's Class A common stock. Which of the following statements is correct?

• A)If boot is added to the exchange, the entire gain realized on the exchange is recognized in full.
• B)The exchange is a Type F reorganization, assuming all requirements are met.
• C)The exchange is tax-free even if no plan of reorganization has been created.
• D)The basis of the Class A common stock received is equal to its FMV.

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Definitions:

Formal Operational

A stage in Piaget’s theory of cognitive development during which people develop the ability to think about abstract concepts.

Reason Abstractly

The cognitive ability to think about objects, principles, and ideas that are not physically present, often involving complex thought processes.

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Implicit rules that govern behavior within a community or group, guiding what is considered acceptable or typical.

Good Behaviors

Actions or conduct that are considered morally right, socially acceptable, or beneficial in a given context.