Determine the Net Income of a "Comparable" Firm Based on the Following

question 49

Multiple Choice

Determine the net income of a "comparable" firm based on the following information: value of target firm = $4,000,000; net income of target firm = $200,000; stock price of "comparable" firm = $30.00; and 300,000 shares of stock outstanding for the comparable firm.

• A) $450,000
• B) $500,000
• C) $550,000
• D) $600,000
• E) $700,000

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Definitions:

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A chart that illustrates the amount of a product that suppliers are prepared to produce and sell at various price points.

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A tax incentive which allows taxpayers to subtract the amount of the credit from the total they owe to the state.