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Kamila [148]
3 years ago
8

The government challenged the acquisition by Procter & Gamble (P&G) of Clorox. Clorox was the leading manufacturer of li

quid bleach at the time of the acquisition, Page 504accounting for 48% of the national sales. It was the only firm selling nationally, and the top two firms accounted for 65% of national sales. P&G is a large, diversified manufacturer of household products, with its primary activity being in the area of soaps, detergents, and cleaners. P&G accounted for 54% of all packaged detergent sales, and the top three firms accounted for 50% of the market. P&G is among the nation’s leading advertisers. What is the basis for the government’s challenge to this acquisition? Explain.
Business
2 answers:
STatiana [176]3 years ago
4 0

Answer:

The basis for the government’s challenge to this acquisition is the reliance on the horizontal merger. If the acquisition is approved, it would dissuade new entrants, discourage active competition from firms already in the industry due to fear of retaliation from Procter and decrease nationwide competition significantly in the liquid bleach field.

Explanation:

According to the case FTC v. Procter & Gamble Co., 386 U.S. 568 (1967), Federal Trade Commission (FTC) held the acquisition violative of § 7 of the Clayton Act.

Phoenix [80]3 years ago
3 0

Answer:

Answer: The basis for the government's challenge to P&G's acquisition of Clorox

Explanation:

The horizontal merger is the basis for the government's challenge to P&G's acquisition of Clorox because the result would have lessened competition substantially in that line of commerce nationwide. P&G being the leading and mainly national advertiser and also mainly national seller of soaps, detergents and cleaners with sales that accounted for 54 % of the market and a  leading brand with 48% of national sales.

With this type of advertising and power control which P&G possess, this would put P&G in a position to control the market and potentially detrimentally affect the consumers. These advantages they posses would reduce the number of competitors and lead to greater concentration in the industry they are.

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Over the past year, the current assets account on the common-size balance sheet of a firm has decreased, while the current liabi
Free_Kalibri [48]

Answer:

Decreased

Explanation:

Liquidity or current ratio =  Current Assets / Current liabilities

If the current asset has been decreased and the current liabilities has been increased then the answer would be higher than before.

The current ratio tells the same and the only difference written above and in current ratio is that the above mentioned Answer is conceptual based whereas current ratio uses numerical values of current assets and current liabilities written in the balance sheet.

Current ratio tells us that whether or not the company is able to meet its short term liabilities (Current Liabilities) using its short term asset (Current Assets).

Remember that the current assets are the assets that are convertible to cash within next 12 months. Whereas current liabilities are the liabilities which we have to pay in cash within the next 12 months.

3 0
3 years ago
Which of the following statements is false? (2 points) If a tangible asset has a finite life, it should be amortized Goodwill is
ss7ja [257]

Answer:

The correct answer is (d)Research and development costs are expensed when incurred, except when the research and development expenditures result in a successful patent.

Explanation:

Research and development costs must be recognized as an expense within the accounting period in which they are presented, since regardless of whether or not a patent was obtained, the organization incurred costs represented in the research and development process that was executed. When this process generates a patent, it is necessary to recognize said right in an asset, but at no time will it be equal to the expenses incurred in the investigation process, since the company hopes to commercialize that knowledge for its own benefit.

6 0
3 years ago
A machine is purchased on January 1, 2018, for $102,000. It is expected to have a useful life of eight years and a residual valu
allochka39001 [22]

Answer:

Depreciation expense 2019= $17,062.5

Explanation:

Giving the following information:

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To calculate the depreciation expense under the double-declining balance, we need to use the following formula:

Annual depreciation= 2*[(book value)/estimated life (years)]

2018= 2*[(102,000 - 11,000)/8]= $22,750

2019= 2*[(91,000 - 22,750)/8]= $17,062.5

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