Which of the Following Is Not a Reason for the Failure

question 2

Multiple Choice

Which of the following is not a reason for the failure of an acquisition to generate the gains originally expected of it?

• A) Poor post-acquisition integration
• B) Overestimation of the potential gains to be derived from synergy
• C) The high cost of making acquisitions
• D) Lack of pre-acquisition screening
• E) Overestimation of the potential costs of realizing synergies

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Definitions:

Pre-Tax Loan Rate

The interest rate on a loan before taking into account any tax deductions that might apply.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual installments.

Tax Loss Carryovers

Provisions that allow businesses or individuals to use their current losses to offset future profits or income for tax purposes, potentially reducing future tax liabilities.

Tax Rate

The percentage of an individual's or corporation's income taken as tax.