Match the Following Items with the Statements That Follow

question 128

Multiple Choice

Match the following items with the statements that follow. Terms may be used more than once.
-Green Corporation transfers 20% of its voting stock to Brown Corporation's shareholders in exchange for 60% of Brown's common stock and 90% of its preferred stock. Green acquired 30% of Brown's common stock three years ago in a taxable transaction. Brown becomes a subsidiary of Green.

• A)Boot
• B)Business credits
• C)Capital gain
• D)Continuity of business enterprise
• E)Continuity of interest
• F)Dividend
• G)Discount rate
• H)Earnings and profits
• I)Federal long-term tax-exempt rate
• J)Liability assumption
• K)Ordinary gain
• L)Ownership change
• M)Section 382 limitation
• N)Sound business purpose
• O)Step transaction

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Definitions:

Opponent-Process Theory

A psychological and neurological model that explains complex behaviors and perceptions (including color vision and emotions) as the result of opposing pairs of stimuli.

Young-Helmholtz Theory

A theory suggesting that the human eye perceives color through the response levels of three kinds of cones, each sensitive to one of three colors: red, green, or blue.

Complementary Color Pairs

Colors that are opposite each other on the color wheel and when combined, cancel each other out to produce a grayscale color like white or black.

Chromatic Color

Colors that have hue, as opposed to achromatic colors (black, white, and grays), often perceived with a distinct colorfulness or saturation.