_____ In a business combination in which the target company's common stock becomes owned by the other company, which of the following always occurs?
A) A pooling of interests.
B) The recognition of goodwill.
C) A parent-subsidiary relationship is formed.
D) A home office-branch/division relationship is formed.
E) None of the above.

Question

Quizplus · Accepted Answer

In a business combination where one company acquires the common stock of another, a parent-subsidiary relationship is always formed. This is because the acquiring company (parent) gains control over the target company (subsidiary), regardless of whether the acquisition is structured as an asset purchase, stock purchase, or merger.

_____ in a Business Combination in Which the Target Company's