Entity a and Entity B Agree to Merge

question 6

Multiple Choice

Entity A and Entity B agree to merge. The capital structure of each entity is:
Entity A - 100 ordinary shares
Entity B - 60 ordinary shares
Entity A issues 2.5 shares in exchange for each ordinary share of Entity B. All of Entity B's shareholders exchange their shares for Entity A shares.
Which of the following statement is correct?

• A) Entity A is both the parent and the acquirer in the transaction.
• B) Entity B is both the parent and the acquirer in the transaction.
• C) Entity A is the legal parent of the subsidiary Entity B and Entity B is the acquirer in the transaction.
• D) Entity B is the parent and Entity A is the acquirer in the transaction.

---

Definitions:

Memory Recall

The process by which information is retrieved from past memories or learned data.

Miller

Refers to George A. Miller, a psychologist known for his work on the magical number seven, plus or minus two, related to the limits of human memory capacity.

Iconic Memory

A type of visual sensory memory that holds a brief replica of visual scenes for a very short duration before fading or being processed further.

Visual Copy

An exact reproduction or duplicate of a visual stimulus.