Burnbay Corporation wants Current Corporation to become a 100% owned subsidiary.Burnbay acquires 90% of Current's stock (worth $300,000)by exchanging its common voting stock with the shareholders of Current.Since 10% of the Current shareholders are not interested in being common shareholders of Burnbay,they retain their shares.This transaction qualifies as what type of reorganization?

Question

Quizplus · Accepted Answer

This reorganization is a "Type B" reorganization.Greater than 80% of Current's shares are acquired by Burnbay using solely voting stock.

Burnbay Corporation Wants Current Corporation to Become a 100% Owned