Which of the Following Statements Is Incorrect

question 74

Multiple Choice

Which of the following statements is incorrect?

• A)The SBA can guarantee up to $750,000 at an interest rate not to exceed 2.75 percent more than the prime lending rate.
• B)The primary function of the SBA is to guarantee loans made to new and small businesses.
• C)For qualified new and small firms that are unable to obtain long-term financing on reasonable terms from banks or other financial institutions, the SBA offers a basic loan guarantee program.
• D)All of the statements are correct.

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Definitions:

Business Combination

Mergers or acquisitions aimed at consolidating resources for growth and competitive advantage.

Pushdown Accounting

The method of accounting for acquisitions where the purchase price of a subsidiary is reflected at fair value on the subsidiary's financial statements, rather than the parent company's.

Acquisition

The process or action in which one company purchases most or all of another company's shares or assets, effectively gaining control over the acquired company.

Consolidated Financial Statements

Financial statements that present the assets, liabilities, and operating results of a parent company and its subsidiaries as if the group were a single entity.