Which of the Following Questions Is False

question 9

Multiple Choice

Which of the following questions is false?

• A) The method of payment (cash or stock) affects how the value of the target's assets is recorded for tax purposes and it affects the combined firm's financial statements for financial reporting.
• B) The combined firm must mark up the value assigned to the target's assets on the financial statements by allocating the purchase price to target assets according to their fair market value.
• C) Any goodwill created in a merger deal can be amortized for tax purposes over 15 years.
• D) Many transactions are carried out as acquisitive reorganizations under the tax code. These structures allow the target shareholders to defer their tax liability on the part of the payment made in acquirer stock but they do not allow the acquirer to step up the book value of the target assets.

---

Definitions:

Adults Unemployed

Individuals of working age who are without work, but are available for and seeking employment.

Adults Not in the Labor Force

Individuals over the working age who are neither employed nor actively seeking employment.

Labor Force

The total number of people, including both the employed and the unemployed, who are actively seeking employment.

Labor Data for Tajnia

Information and statistics about the workforce, employment trends, and unemployment rates within Tajnia.