Tuesday's and Thursday's Are All-Equity fiRms

question 122

Multiple Choice

Tuesday's and Thursday's are all-equity firms. Tuesday's has 5,600 shares outstanding at a market price of $28 a share. Thursday's has 4,500 shares outstanding at a price of $42 a share. Thursday's
Is acquiring Tuesday's. The incremental value of the acquisition is $4,200. What is the value of
Tuesday's to Thursday's?

• A) $130,200
• B) $152,600
• C) $156,800
• D) $161,000
• E) $165,400

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Definitions:

Lower Of Cost

A principle requiring inventory to be recorded at the lower of its original cost or current market value, ensuring valuation is not overstated.