Anderson Inc., BDO Ltd., and Copper Inc., are three Canadian controlled private
ID: 2493598 • Letter: A
Question
Anderson Inc., BDO Ltd., and Copper Inc., are three Canadian controlled private corporations. The common share ownership is as follows: Anderson Inc. John Anderson owns 100 percent of the common shares of this Company. BDO Ltd. John Anderson owns 30 percent of the common shares and his spouse, Wilma Anderson, owns 10 percent of the common shares. Basil Copper owns 35 percent of the common shares and his spouse, Holly Copper, owns 25 percent of the common shares. Holly Copper is John Anderson’s sister. Copper Inc. Basil Copper and Holly Copper each own 50 percent of the common shares of this Company. Indicate which of the Companies described are associated. Explain your conclusions.
Explanation / Answer
Ans: Associate companies are those companies in which parents company possess 20%-50% of voting right in other company.
In the given case Mr. John Anderson who hold the 100% shares of Anderson Ltd is also hold 30% of shares in BDO and his wife Wilma Anderson is also hold 10% of BDO therefore it is clear that BDO is an associate of Anderson INC.
Further Mr. Basil Coper owns 35% of the common share and his wife holly copper also owns 25% shares in BDO and Holly is the sister of Mr JOhn.
Mr. Basil coper and mrs. coper also own 50% share in copper inc. therefore Copper INc is also an associate.