Question

. In determining if a shareholder and a corp. are related parties, the amount of stock owned both directly and indirectly by the shareholder must be determined. In reviewing the stock ownership records you determine the following: S owns directly 500 shares S’s spouse owns 800 shares S’s son owns 100 shares S’s aunt owns 400 shares S’s niece owns 200 shares S’s neighbor owns 700 shares S’ business partner, in a separate partnership, owns 1,000 shares. S’s owns a 50% interest in the partnership. The partnership entity does not own any of the stock. Given this information, S would be considered to own the following number of shares:

A. 3,700 shares B. 3,200shares C. 1,900 shares D. 2,500 shares E. 2,400 shares

Answer 1

Shares held by the relatives of a person will be deemed to be held by the respective person :-

As per legal regulations

Related party definition includes :-

1. Spouse

2. Son

3. Daughter

4. Bussiness partner

In the given case, S owns 500 shares and S's spouse owns 800, S's son owns 100, business partner of S's owns 1000 shares.

S would be considered to own shares as follows :-

Particulars	number of shares
S himself	500
S's spouse	800
S's son	100
S's bussiness partner	1000
Total	2400 shares

S to be considered to own 2400 shares.

These are all the information required to solve the above given question.

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