Small Corp

question 3

Multiple Choice

Small Corp. and Big Corp. are equal partners in Medium Enterprises. The total partnership has a net worth of $210,000, split 50/50 between the two corporations. Size Co. has been asked to join the partnership. When the transaction is complete, all three partners will have an equal interest. To accomplish this structural change, Size Co. will contribute $105,000 to the partnership treasury. This transaction will

• A) increase the original partners' interests.
• B) dilute the original partners' interests.
• C) result in a capital gain for the partners.
• D) result in a capital loss for the partners.

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Definitions:

Consumer Product Safety Act

A United States federal law, enacted in 1972, that establishes guidelines and authority to regulate the safety of consumer products.

FTC Act

A United States law, established in 1914, aimed at promoting competition and protecting consumers from misleading or deceptive practices.

Digital Millennium Copyright Act

A United States law that addresses the rights of copyright holders, aimed at curbing copyright infringement, especially on the Internet.

Lanham Act

The Lanham Act is a federal statute that provides legal protection for trademarks, service marks, and trade dress, helping prevent consumer confusion and unfair competition.