If you take out a loan which two things do your loan payments go toward

Mergers and acquisitions commonly introduce __________ risk, which may change how an organization operates.

Debora [2.8K]

Mergers and acquisitions commonly introduce financial risks that can change how the firm operates.

The main danger is financial; if mergers and acquisitions aren't done right, they can leave businesses with a heavy monetary load. Many mergers that go wrong involve excessive financial commitments that condemn the partnership to failure from the outset.

Risk management is necessary during the whole merger and acquisition process. Management of Merger & Acquisition risk; see due diligence. It's likely that you haven't properly undertaken Merger & acquisition risk management if any of the risks outlined in the preceding sentence are not on the due diligence agenda.

Although this is simply one aspect of due diligence, there is a tendency to think of it as an audit of the target organization. Your due diligence procedure is your Merger & acquisition risk management, in a larger sense.

To learn more about Merger & Acquisition

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5 0

1 year ago

Equity method journal entries (price greater than book value) An investor purchases a 25% interest in an investee company, and t

Crazy boy [7]

Answer:

See answer an explanation below.

Explanation:

The journal entries will look as follows:

General Journal

Description Debit ($) Credit ($)

Equity investment 145,000

Cash 145,000

(To record purchase of investment.)

Cash 25,000

Income from equity investment (w.1) 25,000

(To record equity income.)

Cash 20,000

Equity investment 20,000

(To record receipt of cash dividend.)

Income from equity investment 2,000

Equity investment (w.2) 2,000

(To record patent amortization expense.)

Cash 180,000

Gain on sale of equity invest. (w.4) 32,000

Equity investment (w.3) 148,000

(To record sale of investment.)

Workings

w.1: Income from equity investment = Investee's net income * Percentage of interest = $100,000 * 25% = $25,000

w.2: Equity investment = (Patent value / Remaining useful life) * Percentage of interest = ($80,000 / 10) * 25% = $8,000 * 25% = $2,000

w.3: Equity investment = $145,000 + $25,000 - $20,000 - $2,000 = $148,000

w.4: Gain on sale of equity investment = Sales proceed - w.3 = $180,000 - $148,000 = $32,000

4 0

3 years ago

Suppose Country A and Country B each have a GDP equal to $440 billion and $560 billion respectively. Country A has 100 million p

Ber [7]

Answer:

A. Higher in Country A

Explanation:

So to get per capita income

Formula

GDP/Population

Therefore

For Country A

440/100=4.4

Per capita income for country A is 4.4

For Country B

560/175=3.2

Per capita income for country B is 3.2

So the per capita income for country A is higher than Country B

3 0

3 years ago

To find the annual rate of return on any given stock, add the stock's dividend for the year plus the change in the stock's price

katrin2010 [14]

Answer:

The statement is: True.

Explanation:

The Annual Rate of Return or Yearly Rate of Return is the amount earned over an investment within one year. It is typically represented as a percentage and takes into consideration capital appreciation and the payment of dividends. The formula to calculate the annual rate of return is the following:

Annual Rate of Return = (EYP - BYP)/BYP X 100%

Where:

EYP = End of year price

BYP = Beginning of year price

8 0

3 years ago

How would a computer enhance the productivity of a business

Bas_tet [7]

A computer would enhance the productivity of a business because it would produce better communication and would also help things be accomplished faster. hope that helps if not lmk

7 0

3 years ago

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