Alan owns all of the common shares of Holdco Inc., and 25% of Family Manufacturing Inc. (FMI), a manufacturer of office furniture. Bea, Alan's wife, and Colin, Alan's brother, own 40% and 35%, respectively, of the common shares of FMI.

 

Yvonne, age 27, and Zena, age 30, each own 50% of the common shares of Whyzed Ltd., a retailer of ladies' clothing. They are the daughters of Alan and Bea. Their common shares have a total value of $100,000. Holdco Inc. owns all 150 of the voting preferred shares of Whyzed Ltd. These preferred shares have a value of $1,500,000. Each share of both classes has one vote. 

 

Required:

 

Determine whether the corporations described are associated.  Substantiate your determination by reference to specific conditions in the Act.  Be very thorough in your explanations. 

Determine whether an election under subsection 256(2) is possible.

Reference: Candian Corporation Taxation (2022)