Sya Ltd Acquired All the Assets and Liabilities of Littman Ltd

question 38

Multiple Choice

Sya Ltd. acquired all the assets and liabilities of Littman Ltd. by issuing common shares to Littman. After this transaction, Littman owned 30% of Sya's outstanding shares. Which of the following statements is true?

• A)Littman is now a subsidiary of Sya.
• B)This is an intercorporate investment for Sya.
• C)Sya does not need to prepare consolidated financial statements.
• D)Sya should use the equity method to reflect its investment in Littman.