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    Disproportionate redemption is illustrated.

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    28. Brenda owns 600 shares of Eagle Corporation stock at a time when Eagle has 1,000 shares of stock outstanding. The remaining shareholders are unrelated to Brenda. What is the minimum number of shares Eagle must redeem from Brenda so that the transaction will qualify as a disproportionate redemption?
    a. 121 shares.
    b. 231 shares.
    c. 301 shares.
    d. 501 shares.
    e. None of the above.

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    Solution Preview

    The answer is B. Brenda owns 60% of the outstanding shares of stock before the ...

    Solution Summary

    Disproportionate redemption is given for Eagle Corporation.