Question

luke is the owner of Fun Times, a U.S. event-planning company. He plans to open an event-planning company, Events & Adventures, in Germany. Events & Adventures will be totally owned and controlled by Fun Times, which makes Events & Adventures a ________ of Fun Times.

Answer 1

Answer:

wholly owned subsidiary.

Explanation:

Wholly owned subsidiary refers to a company whose stocks are completely owned by another parent company. This parent company has a complete control over the subsidiary and has the authority to determine the decisions that should be made by the subsidiary. (From the excerpt above, Events & adventures will be the subsidiary and Fun Times is the parent company)

In general, subsidiaries tend to be formed by the parent company to obtain a different consumer base by utilizing the unused assets that is owned by the parent company.

Answer 2

From the above statement, it can be concluded that the Event & Adventure as a subsidiary of Fun Technology.

Further explanation

Holding Company is a company owned by a parent company or several parent companies to supervise, coordinate and control the business activities of its subsidiaries.

The parent company itself is a company that aims to own shares in one or more other companies and can control all business processes in any business entity that has controlled its shares. By grouping companies into parent companies, it is hoped that the objectives of increasing or creating a market value of the company will be achieved. Whereas a Subsidiary is a subsidiary where the percentage of share ownership by the parent company is the majority, generally exceeding 50% of the subsidiary's shares.

Procedure for Forming a Holding Company

Meanwhile, the formation of a holding company can be done through three procedures, namely:

1. Residue procedure

In this case, the original company is broken up according to each business sector. The company that has been split has become an independent company, while the rest (residue) from the original company which is turned into a holding company.

2. Full procedure

This full procedure should be carried out if there were not too many companies splits before, but each company with the same ownership was scattered, without being concentrated in a company.

3. Programmed procedures

Sometimes, since business people have been aware of the importance of holding companies, so from the beginning, business people have thought of forming a holding company. Therefore, the company that was first established in the group is a holding company. Then for each business conducted, another company will be formed or acquired, where the holding company as a shareholder is usually together with other parties as business partners.

From the above statement, it is very clear that Fun times as a holding company and Events & Adventure are subsidiaries of the company.

Learn more

Holding Company brainly.com/question/5058691, brainly.com/question/13380715

Details

Class: High School

Subject: Social studies

Keyword: Holding Company.