When the Management of a Potentially Target Company Buys Other

question 61

Multiple Choice

When the management of a potentially target company buys other companies so that they will be more difficult to take over, it is called

• A)greenmail.
• B)a poison pill.
• C)a blowfish defense.
• D)a scorched earth defense.

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Definitions:

Consolidated Net Income

Consolidated net income refers to the total earnings of a parent company and its subsidiaries after taxes and expenses, adjusted for minority interests.

Consolidated Retained Earnings

The cumulative amount of net income earned by a parent company and its subsidiaries, less any dividends paid, as presented in consolidated financial statements.

Consolidated Net Income

Consolidated net income refers to the total profit of a parent company and its subsidiaries after all intercompany transactions have been eliminated, representing the overall earnings of the corporate group.

Parent

The entity that controls one or more subsidiaries through ownership of the majority of voting rights or through other means.