JAMB Accounting 2018 Objective — Question 29

Question 29 of 40 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2018 Objective paper, with the correct answer and a full explanation.

Bala Ltd acquired the business of Bello Ltd and caused the separate existence of the latter company to terminate. This situation is best described as

A. conversion
B. dissolution
C. merger
D. absorptionCorrect

Explanation

When a company takes over another and that results in the end of the one taken over, such is described in business terms as absorption.

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