Global Mergers and Acquisitions / Sirius XM Radio

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Global Mergers and Acquisitions / Sirius XM Radio

Category: Coursework

Subcategory: Accounting

Level: University

Pages: 1

Words: 550

Global Mergers and Acquisitions
Student’s Name
Institution
Global Mergers and Acquisitions
Question one
For the e-activity, I selected Apple Incorporate which applies US GAAP in the treatment of impairment. According to generally accepted accounting principles, the impairment charge is to be allocated to the cash generating units. The fee is assigned to the zero or non-negative values of cash generating units. It implies that the applied cost will highly depend on the carrying value of the cash generating unit. On the other hand, international financial reporting standards specify that goodwill is allocated to the amount of cash generating units. It means a customer will adjust the value of the goodwill based on the value of cash and non-cash generating activities compared to GAAP which allocates the charge according to the amount of cash-generating units (Davelle & Rizzato, 2012)
Stakeholders are likely to react to the impairment negatively since it decreases the value of the cash generating assets of the business. Most of the affected stakeholders are the shareholders and management who have an interest in the performance of the firm.
Question 2
One of the latest mergers occurred between Amazon and Whole Foods. The transaction which was finalized in 2017 resulted in an increase in market value of Amazon which was the acquiring company. The acquisition value was $13.4 billion, and it resulted in the rise in the valuation of Amazon by an equivalent amount imme…

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