What Type of Transaction Employs Special Committees Made Up of Disinterested

question 25

Multiple Choice

What type of transaction employs special committees made up of disinterested board members who review the transaction to determine if it is entirely fair to the corporation?

• A)hostile takeover
• B)self-dealing
• C)rational business purpose
• D)corporate opportunity

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Definitions:

Inventory

An accounting term for goods and materials that a business holds for the ultimate goal of resale or repair.

Inventory Turnover

A measure of how frequently a company sells and replaces its stock of goods during a certain period of time, indicating the efficiency of inventory management.

Lower-Of-Cost-Or-Market

An accounting principle that values inventory at the lower of either its historical cost or its current market price.

Inventory Valuation

The method used to calculate the cost of goods available for sale and determining the ending inventory value for financial reporting purposes.