American Corporation Acquires the Noncash Assets of Utech Corporation in Exchange

question 32

Multiple Choice

American Corporation acquires the noncash assets of Utech Corporation in exchange for $700,000 of its voting stock plus $50,000 of cash. Utech Corporation assets are worth $750,000. Utech Corporation does not distribute the stock and cash but instead holds the stock as an investment. Utech will use the American cash along with the cash it retained to start a new business. The transaction can be classified as a

• A)Type A reorganization.
• B)Type B reorganization.
• C)Type C reorganization.
• D)The transaction does not qualify as a tax-free reorganization.

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Definitions:

Warrior Vase

An ancient Mycenaean ceramic artifact, decorated with motifs depicting armed warriors, highlighting aspects of their military culture.

Non-Unified Ground Line

A feature in visual art where the ground or floor line on which figures stand is not consistent across the scene, often used in ancient and medieval art to show different spatial settings or narrative moments.

Cyclopean Masonry

A method of stone construction, named after the mythical Cyclopes, using massive, irregular blocks without mortar, characteristic of the Bronze Age fortifications of Tiryns and other Mycenaean sites.

Fortification Walls

Structures built to protect cities, castles, or territories from potential attackers, typically made of stone or brick and dating back to ancient times.