A Company Owns 80% of the Voting Shares of B

question 55

Multiple Choice

A Company owns 80% of the voting shares of B Company,which in turn owns 70% of the shares of C Company.There are no outstanding warrants or options which would enable holders of other instruments to acquire additional voting shares of any of these companies.In this scenario,

• A)A has no control over C because it does not own any shares of C Company.
• B)A has direct control over C.
• C)A has indirect control over C.
• D)control cannot be determined from the information given.

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Definitions:

Investments Section

The investments section forms part of a company's financial statements, detailing all investments held by the company, including securities, bonds, and tangible assets held for long-term gains.

Balance Sheet

A statement that lists a company's assets, its liabilities, and the equity held by its shareholders, providing a snapshot of its financial health at a certain time.

Collectible

A collectible is an item worth collecting due to its rarity, condition, demand, or other unique characteristics, often appreciated in value over time.

Trade Receivables

Amounts owed to a business by its customers as a result of the sale of goods or services on credit.