Question

A statutory consolidation is a type of business combination in which:

A) One of the combining companies survives and the other loses its separate identity.
B) One company acquires the voting shares of the other company and the two companies continue to operate as separate legal entities.
C) Two publicly traded companies agree to share a board of directors.
D) Each of the combining companies is dissolved and the net assets of both companies are transferred to a newly created corporation.

Answer 1

A statutory consolidation in a business combination is when each of the combining companies is dissolved and the net assets of both companies are transferred to a newly created corporation.

Step-by-step explanation:

A statutory consolidation in a business combination is when each of the combining companies is dissolved and the net assets of both companies are transferred to a newly created corporation. This means that both companies cease to exist as separate entities and are combined into a single new corporation. This type of consolidation is different from other types of business combinations, such as mergers or acquisitions, where one company may survive or the combining companies continue to operate as separate legal entities.