Each of the Following Is True About the Acquisition Search

question 124

Multiple Choice

Each of the following is true about the acquisition search process except for

• A) A candidate search should start with identifying the primary selection criteria.
• B) The number of selection criteria should be as lengthy as possible.
• C) At a minimum, the primary criteria should include the industry and desired size of transaction.
• D) The size of the transaction may be defined in terms of the maximum purchase price the acquirer is willing to pay.
• E) A search strategy entails the use of electronic databases, trade publications, and querying the acquirer's law, banking, and accounting firms for qualified candidates.

Understand the impact of fixed and variable costs on product line decisions.

Recognize the components and significance of capital budgeting.

Calculate and interpret the cash payback period.

Apply the annual rate of return method for investment evaluation.