Rock Corporation Acquires All of the Assets of Stone Corporation

question 30

Multiple Choice

Rock Corporation acquires all of the assets of Stone Corporation using only its voting stock. Stone Corporation distributes the Rock stock to its shareholders pursuant to its liquidation. After the acquisition, Stone Corporation's shareholders own 20% of the Rock stock (by voting power and value) . The transaction is classified as a

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

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Definitions:

Better Products

This denotes products that are considered superior in quality or performance compared to others.

Dictator Game

An experimental game in economics and psychology where one participant, the "dictator," determines how to split an endowment between themselves and another participant.

Behavioral Economists

Researchers dedicated to understanding how psychological, cognitive, emotional, cultural, and social influences shape the economic choices made by individuals and institutions.

Evenly Split

A division or distribution of something into equal or nearly equal parts.