In an acquisition, the target firm may demand compensation from the acquiring firm if the deal falls through. The acquiring firm's compensation is for the payment of a form of a real call option.
Answer the following statement true (T) or false (F)
True
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Lubing Company Lubing Company sold merchandise to Lewing Corporation. on December 1, 2012, for $100,000. Lubing accepted a promissory note from Lewing Corporation for $100,000. The note has a term of 6 months and an annual interest rate of 9%. Lubing's accounting period ends on December 31, 2012. Refer to the information provided for Lubing Company. What amount should Lubing recognize as interest
revenue on the maturity date of the note? A) $ -0- B) $4,500 C) $3,750 D) $9,000
Sales mix can be expressed in terms of
A) units but not revenues B) revenues but not units C) either revenues or units D) neither units nor revenue
Which of the following statements is true?
A. Financial leverage should not be considered when a firm borrows money. B. Under the right circumstances, the use of borrowed money can improve a firm's return on owners' equity. C. There is no good reason for a firm to borrow money when it has cash to finance expansion. D. The use of borrowed money always reduces a firm's return on owners' equity. E. Return on owners' equity is not an important financial calculation.
? is a population parameter and s is a sample statistic
Indicate whether the statement is true or false