Which of the following is not true of the financing plan?
A) It is rarely affected by the discovery during due diligence of target assets not required to operate the business.
B) It may include both stock and debt.
C) It may include a combination of stock, debt, and cash.
D) It serves as a reality check on the buyer.
E) None of the above.

Question

Quizplus · Accepted Answer

The statement "It is rarely affected by the discovery during due diligence of target assets not required to operate the business" is not true. In fact, the discovery during due diligence of target assets not required to operate the business can have a significant impact on the financing plan. For example, if the target company has unused assets that could be sold to generate cash, the buyer may be able to reduce the amount of debt or equity financing needed to complete the acquisition.

Which of the Following Is Not True of the Financing