A firm can use which method of financing for an acquisition structured as either an asset or stock acquisition? O Cash O Issuing Debt O Issuing Bond None of the answers
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- Which of the following accounting methods is used to account for controlling interest investments? A. cost method B. discounted cash flow method C. consolidation method D. acquisition methoIn a stock acquisition accounted for by the equity method, a portion of the purchase price often is attributed to goodwill or to specific assets or liabilities. How are these amounts determined at acquisition? How are these amounts accounted for in subsequent periods?Describe the equity method and the cost method of investor accounting for acquisitions
- When an investment is acquired, what is the initial reporting basis for all investments in equity securities? Group of answer choices: a) Fair market value b) Equity value c) Discounted present value d) CostWhich liabilities constitute debt within the context of firm's valuation during mergers and acquisition?Assuming the investment is appropriately recognized as a financial asset intended to collect contractual cash flows and also to sell the bonds in open market: Determine the initial valuation of the investment.
- Explain the adjustments made in the equity method when the fair value of the net assets underlying an investment exceeds their book value at acquisition.Which of the following items would be presented in a cash flow statement? Group of answer choices Proceeds from the issue of debentures Refinancing of long-term debt Payment of dividends through a share investment scheme Acquisition of an investment in a subsidiary for consideration consisting of an exchange of non-current assets and liabilitiesA entity's policy regarding which short-term, highly liquid investments it classihes as cast equivalents is usually disclosed in its financial statement note disclosures
- ._______ An offer to purchase the stock of a firm targeted for acquisition.Explain the difference(s) between investments in equity securities classified as current assets versus those classified as long-term (noncurrent) assets.In an accretion/dilution analysis of an acquisition, if the purchase price exceeds the book value of the target’s assets, discuss the key components of the balance sheet that will be adjusted on the pro forma financials.
