A Purchaser Has Agreed to Purchase All of the Shares

question 4

Multiple Choice

A purchaser has agreed to purchase all of the shares of Tee Co., a CCPC. Tee Co. owns fifteen significant capital assets, some of which have appreciated in value. Which of the following is TRUE?

• A) The capital cost allowance on the assets will be higher for the purchaser than it was for the vendor.
• B) The purchaser will obtain a cost base of the assets equal to fair market value.
• C) The purchaser will be responsible for the liabilities of Tee Co.
• D) The sale will result in business income for the vendor.

---

Definitions:

Free-Living

Describes organisms that do not depend on another organism for survival; they are not parasitic and can exist independently in an environment.

Aquatic

Pertaining to water; living or occurring in water, whether it be freshwater, brackish, or saltwater.

Parasitic

Pertaining to an organism that lives on or in a host organism and causes harm to the host.

Terrestrial

Pertaining to or representing the earth or dry land, as opposed to aquatic environments.