Webb Company owns 90% of Jones Company. The original balances presented for Jones and Webb as of January 1, 2011, are as follows

Jones company:

Shares outstanding 100,000

Book value of jones 1,200,000

book value per share $12

Webb company:

shares owned of jones 90,000

book value of investment 1,080,000

Jones sells 20,000 shares of previously unissued shares of its common stock to outside parties for $10 per share. What is the new percent ownership of Webb in Jones after the stock issuance?

A.

75%.

B.

90%.

C.

80%.

D.

64%.

E.

60%.