Which of the Following Statements Best Describes the Continuity of Interest

question 39

Multiple Choice

Which of the following statements best describes the continuity of interest principle as it applies to a tax-deferred acquisition?

• A)Continuity of interest requires each shareholder to receive at least 40 percent of the consideration received in equity of the acquirer.
• B)Continuity of interest requires shareholders in the aggregate to receive at least 40 percent of the consideration received in equity of the acquirer.
• C)Continuity of interest requires each shareholder to receive at least 80 percent of the consideration received in equity of the acquirer.
• D)Continuity of interest requires shareholders in the aggregate to receive at least 80 percent of the consideration received in equity of the acquirer.

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Definitions:

Homeostasis

The regulatory process organisms use to maintain stable internal conditions despite external changes.

Teratogens

Substances or agents that can cross the placental barrier and produce fetal deformities when taken or absorbed by the mother during pregnancy.

Genetic Mutations

Permanent alterations in the DNA sequence that makes up a gene, which can result in variations in physical traits and health conditions.

Defective Alleles

Variant forms of a gene that may cause a malfunction or absence of the gene's normal function.