Which One of the Following Statements Is Correct

question 58

Multiple Choice

Which one of the following statements is correct?

• A) If an acquisition is made with cash, then the cost of that acquisition is dependent upon the acquisition gains.
• B) Acquisitions made by exchanging shares of stock are normally taxable transactions.
• C) The management of an acquiring firm may put itself at risk of losing control of the firm if they make acquisitions using shares of stock.
• D) The stockholders of the acquiring firm will be better off when an acquisition results in losses if the acquisition was made with cash rather than with stock.
• E) Acquisitions based on legitimate business purposes are not taxable transactions regardless of the means of financing used.

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Definitions:

Phallic Stage

A phase in Freudian psychosexual development, occurring roughly between the ages of three and six, where the libido is centered on the genital area.

Anal Stage

The second stage in Freud's psychosexual development theory, happening around age 2, where the focus of pleasure is on controlling bladder and bowel movements.

Oral Stage

The first stage in Freud's psychosexual development, occurring from birth to approximately 18 months of age, where the mouth is the primary source of gratification.

Latency Stage

A phase in Freudian psychosexual development where sexual urges are repressed and children focus on social and intellectual skills.