Which of the Following Statements Best Describes the Continuity of Interest

question 39

Multiple Choice

Which of the following statements best describes the continuity of interest principle as it applies to a tax-deferred acquisition?

• A)Continuity of interest requires each shareholder to receive at least 40 percent of the consideration received in equity of the acquirer.
• B)Continuity of interest requires shareholders in the aggregate to receive at least 40 percent of the consideration received in equity of the acquirer.
• C)Continuity of interest requires each shareholder to receive at least 80 percent of the consideration received in equity of the acquirer.
• D)Continuity of interest requires shareholders in the aggregate to receive at least 80 percent of the consideration received in equity of the acquirer.

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Definitions:

Frequency Distribution

A statistical representation that shows the number of occurrences of each value in a dataset, often displayed in a table or graph.

Class Width

The difference between the upper and lower boundaries of a class interval in frequency distribution.

Relative Frequency Distributions

These distributions show the proportion of observations within a dataset that belong to different categories or intervals.

Discrete Data

Data that can only take specific values and are countable, often representing categories or counts.