Taylor's Hardware Is Acquiring the Corner Store for $25,000 in Cash.Taylor's

question 65

Multiple Choice

Taylor's Hardware is acquiring The Corner Store for $25,000 in cash.Taylor's has 1,500 shares of stock outstanding at a market value of $46 a share.The Corner Store has 2,200 shares of stock outstanding at a market price of $8 a share.Neither firm has any debt.The incremental value of the acquisition is $3,500.What is the value of Taylor's Hardware after the acquisition?

• A)$49,000
• B)$50,300
• C)$57,300
• D)$65,100
• E)$72,400

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Definitions:

Accounting-Based Incentives

Accounting-Based Incentives are rewards given to managers or employees based on reaching specific financial performance targets.

Executive Compensation

This refers to the financial payments and other non-monetary benefits provided to high-level management and executives in a company, including salaries, bonuses, stock options, and other perks.

Shareholder Value

The financial worth delivered to shareholders, typically measured by the increase in share price and dividends paid over time.

Capital Adequacy Ratio

A measure of a bank's capital, used to protect depositors and promote stability and efficiency in financial systems.