A Product Extension Merger Occurs When Acquiring and Acquired Companies

question 47

True/False

A product extension merger occurs when acquiring and acquired companies have related production and/or distribution activities but do not have products that compete directly with each other. 

---

Definitions:

Net Income

The amount of money a company keeps as profit once all taxes and expenses are deducted from its total income.

Accounting Records

Documents and ledgers that record financial transactions and the financial position of an entity, serving as the basis for financial reporting and analysis.

Service Department Charge Rate

A rate used to allocate service department costs to the products or services produced, often based on the time or resources each product uses.

Personnel Department

A division of a company responsible for managing human resources and employee relations.