Rabbit Corporation and Fox Corporation Would Like to Merge into One

question 81

Multiple Choice

Rabbit Corporation and Fox Corporation would like to merge into one company.Rabbit's only asset is a nontransferable chemical process that has a value of $300,000 and Rabbit has liabilities of $100,000.Fox has the manufacturing plant and experience in the production of Rabbit's chemical process.Its manufacturing plant has a value of $900,000 with a mortgage of $200,000.Which type of reorganization would be the most appropriate for Rabbit and Fox?

• A)"Type A" consolidation reorganization.
• B)"Type B" reorganization.
• C)"Type C" reorganization.
• D)Acquisitive "Type D" reorganization.
• E)None of the above is appropriate.

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Definitions:

Customer Cost Analysis

An assessment of the costs associated with acquiring and serving a customer, used to evaluate the profitability of customer relationships.

Time-Driven Activity-Based Costing

An accounting method that assigns costs based on the actual time resources are consumed by activities, improving accuracy of cost allocation.

Tech Support Department

A specialized unit within a company that provides technical assistance and support related to computer systems, software, and hardware to customers or employees.

Cost Per Minute

A metric used to calculate the expense incurred for every minute of operation, often in manufacturing or services.