Which One of the Following Statements Is Correct

question 79

Multiple Choice

Which one of the following statements is correct?

• A) The shareholders of an acquired firm are generally given a choice of accepting either cash or shares of stock when the acquisition is tax free.
• B) To be a tax-free acquisition, the shareholders of an acquired firm must receive shares in the acquiring firm that are equal to 25 percent or less of the value of the shares held in the acquired firm.
• C) The assets of an acquired firm are recorded on the books of the acquiring firm at their current book value regardless of the tax status of the acquisition.
• D) Target firm shareholders demand a higher selling price when an acquisition is a nontaxable event.
• E) If the assets of a firm are written up as part of the acquisition process, the increase in value is considered to be a taxable gain.

Comprehend the basics of moving or copying cells with drag and drop techniques.

Learn to properly use cell alignment and positioning to organize data within cells.

Recognize the importance of using cell references in formulas for dynamic data manipulation.

Familiarize with Excel's formatting tools, including text orientation and indent functions.

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Definitions:

Excise Tax

A tax levied on the manufacture, sale, or consumption of certain products or activities, often specific to certain goods like tobacco, alcohol, and fuel.

Deadweight Loss

The loss of economic efficiency that can occur when the free market equilibrium for a good or a service is not achieved.

Consumer Surplus

The contrast between the total price consumers aim and are capable of paying for a good or service and the price they actually pay.

Tax

Mandatory financial charges imposed by a government on individuals or entities to fund public expenditures.