Mergers and Acquisitions Are a Popular Mode of Investment for Firms

question 89

Multiple Choice

Mergers and acquisitions are a popular mode of investment for firms wishing to protect,consolidate and advance their global competitive positions.Examples include

• A)selling off divisions that fall outside the scope of their core competence.
• B)acquiring strategic assets that reduce their competitiveness.
• C)firms can better leverage their intangible assets and on a larger scale through licensing.
• D)none of the options

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Definitions:

Corporate Tax Return

A corporate tax return, often filed using Form 1120, is required for corporations and details the income, gains, losses, deductions, and credits from the corporation's operations.

Foreign Subsidiaries

Companies that are partially or wholly owned by a parent company but are located in a different country.

Cash-basis

An accounting method that recognizes revenues and expenses only when cash is exchanged, as opposed to when they are incurred.

Tax Depreciation

The allowable deduction for depreciation of assets for tax purposes, calculated using methods prescribed by the IRS.