Performance Terms in the Acquisition Agreement Will Usually Not Result

question 35

True/False

Performance terms in the acquisition agreement will usually not result in additional payments as the risks have already passed to the buyer.

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Definitions:

Net Income

The final earnings of a corporation once all costs, taxes, and expenses are subtracted from gross revenue.

Retained Earnings

Retained Earnings are the portion of a company's profits that are not distributed as dividends to shareholders but are instead reinvested in the business.

Loss Accounts

Financial accounts within a company's books that represent expenses exceeding incomes, leading to a net loss.