Quantum Company exchanges some of its shares for some of the shares of Rocket Corporation. The exchange is used to create Space Inc., whose business activity is to hold the shares of the two companies. Space Inc. is
A)a holding company.
B)a parent corporation.
C)a subsidiary corporation.
D)a foreign corporation.

Question

Quizplus · Accepted Answer

A holding company is an entity created to own the shares of other companies, which is exactly what Space Inc. is doing by holding shares of Quantum Company and Rocket Corporation.

Quantum Company Exchanges Some of Its Shares for Some of the Shares