True or false?
a. Under purchase accounting any difference between the amount paid for the target’s assets and their book value is shown as in the merged company’s balance sheet.
b. In a tax-free merger, the acquirer can write up the value of the target’s assets and deduct a higher depreciation charge.
c. If a company receives payment from the Internal Revenue Service, it is known as “tax inversion.”
d. Both the Justice Department and the FTC can seek injunctions to delay a merger where there may be anti-trust issues.
e. Stock financing for mergers mitigates the effect of over- or under-valuation of the target.
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