A Merger Between Two Firms That Make and Sell Similar

question 97

Multiple Choice

A merger between two firms that make and sell similar products in similar markets is known as a

• A) horizontal merger.
• B) cooperative.
• C) joint venture.
• D) vertical merger.
• E) conglomerate merger.

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Definitions:

Subsidiary

A company that is controlled by another company, known as the parent company, through ownership of more than 50% of its voting stock.

Interest Revenue

Income earned on investments or money lent, represented by the amount charged to borrowers for the use of the lender's funds.

Elimination

In accounting, the process of removing intercompany transactions from the financial statements of a consolidated group.

Consolidated Financial Statements

Financial reports that aggregate all financial information of a parent company and its subsidiaries, showing the group's overall financial performance and position.