A Company is interested in a merger with B Company. B Company is growing very fast and the price of its shares has risen rapidly. The two firms will continue as separate companies after the merger, with one being a subsidiary of the other. However, the two parties are having difficulty agreeing to a price. They have agreed that A Company will issue shares to B Company shareholders and then both A's original shareholders and B's former shareholders will own A company. Three scenarios are under review as shown below.

Required:
(a) For each scenario, determine who owns the shares of A Company and B Company after the merger.
(b) For each scenario, determine which shareholder group is in control of A Company after the merger.
(c) For each scenario, determine which company is the parent company and which is the subsidiary after the merger.

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Scenario Number of shares outstanding of A Company Price of one A Company share Number of shares outstanding of B Company Price of one B company share Consideration given 1,000,000 $25 250,000 $50 3 shares of A for 1 share of B 1,000,000 $25 250,000 $50 4 shares of A for 1 share of B 1,000,000 $25 250,000 $50 5 shares of A for 1 share of 8