If an Acquirer Buys Most of the Operating Assets of a Target

question 65

True/False

If an acquirer buys most of the operating assets of a target firm, the target generally is forced to liquidate its remaining assets and pay the after-tax proceeds to its shareholders.

---

Definitions:

Transactions Identified

The process of recognizing and documenting specific financial events in the appropriate accounting period.

Accounts Used

Refers to specific accounts in the general ledger that are impacted by transactions and financial events of a business.

Recording Revenue

The process of documenting the income a company generates from its business activities, typically recognized when goods or services are delivered.

Increase in Assets

An upward adjustment or growth in the value of resources controlled by a company that are expected to bring future economic benefits.