Which of the following statements is true regarding the composition of a corporation?

The statement that corporations may be composed wholly of other corporations is accurate because the Revised Corporation Code allows for the creation of a parent-subsidiary structure, where a corporation can own all the shares of another corporation, effectively making it a wholly owned subsidiary. This structure is commonly used in business for various strategic reasons, such as liability protection, tax advantages, and operational efficiency.

The flexibility in the composition of corporations is an important aspect of corporate law, and it enables businesses to organize in a manner that benefits their operations. This arrangement aligns with the principles of corporate governance, where entities can create corporate groups to manage different aspects of their operations more effectively.