In Order to Normalize the Historical Data of the Target

question 91

True/False

In order to normalize the historical data of the target firm,it may be necessary to subtract large increases in
reserves and add back large decreases in reserves from cash flow.

---

Definitions:

Annual Interest Accrual

The amount of interest that accumulates on a financial obligation over the course of a year.

Bonds Issuance

The process of offering bonds to investors as a means of raising capital for the issuer.

Face Amount

The nominal or dollar value stated on a financial instrument or security, such as the original amount on a bond or insurance policy.

Bond Redemption

The process of repaying the principal amount of a bond at its maturity date.