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B owns 40% and C owns 60% of the stock of Target. Target merges into...

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Accounting

B owns 40% and C owns 60% of the stock of Target. Target merges into Acquiring. B receives solely Acquiring non-voting common stock and C receives solely cash. A week after (and as part of the same plan that includes) the merger, Acquiring redeems half of the stock that it issued to B. Choose the best answer regarding the redemption:

A It will violate continuity of interest (CoI).

B It will not violate continuity of interest (CoI) because it is not a purchase by a related party.

C It will not violate continuity of interest (CoI) because the shareholder would have received sufficient Acquiring stock notwithstanding the redemption.

D It will not violate continuity of interest (CoI) because a Target shareholder is free to sell its

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