Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. on 1 august 2023, alpha ltd holds a substantive de

On 1 August 2023, Alpha Ltd holds a substantive deep-in-the-money option to acquire the majority...

50.1K

Verified Solution

Question

Accounting

On 1 August 2023, Alpha Ltd holds a substantive deep-in-the-money option to acquire the majority of shares in Beta Ltd that is exercisable in 30 days. The earliest date the existing shareholders of Beta Ltd can call a special shareholders' meeting to change the company's policies on its relevant activities is in 25 days. Based on these facts only, does Alpha Ltd have the power to control Beta Ltd as of 1 August 2023? 1. Alpha Ltd does not have the power to control because the option cannot be exercised before the earliest date that a shareholders' meeting can be convened to change the company's policies on relevant activities. 2. Alpha Ltd does not have the power to control because the option only represents potential voting rights, not real voting rights. 3. Alpha Ltd does not have the power to control because Alpha Ltd will suffer a financial penalty if the option is exercised. 4. Alpha Ltd does not have the power to control because the option has not been exercised.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students