Which of the Following Would NOT Be Classified as Value

question 37

Multiple Choice

Which of the following would NOT be classified as value added by the buyer in a merger?

• A)The present value of estimated synergies due to the merger.
• B)The current value of the target firm as a stand-alone entity.
• C)New value-adding strategies initiated post-merger by the purchasing firm.
• D)Enhanced credit ratings that develop as a result of the merger.

---

Definitions:

Unrealised Profits

Profits that have been earned but not yet realized through a transaction, such as the increase in value of an investment that has not been sold.

Issued Capital

The total value of a company's shares that have been issued to shareholders.

Elimination

The process of removing internal transactions or balances when preparing consolidated financial statements to avoid double counting.