Which of the Following Statements Is Correct with Regards to Liabilities

question 106

Multiple Choice

Which of the following statements is correct with regards to liabilities in corporate reorganizations?

• A)While in a "Type A" merger all the liabilities of the target must be acquired, in a consolidation only general liabilities are transferred.
• B)In a "Type G" reorganization, the target's liabilities rarely are liquidated.
• C)Liabilities are problematic for a "Type C" only when the acquiring corporation transfers other property in addition to common stock.
• D)Long-term liabilities (bonds) can be exchanged tax-free in a "Type E" reorganization, as long as the terms of the bonds are greater than 10 years and the interest rates are identical.
• E)None of the above.

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