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How do you calculate capital gain after a merger or acquisition that involves both cash and stock?
Wiki User
∙ 9y ago
1099B form from your broker should be showing the sales proceeds correctly. First check the surviving company's web site for instructions on how to calculate the new cost basis of the surviving entity. The rule is that your economic gain (market value of new stock plus cash received less cost basis in your original shares) is only taxable to the extent of cash received (referred to as cash to boot.) You can apply the formula:
GAIN = Lesser of (CASH RECEIVED) or (Market value of NEW company's stock received plus CASH received less OLD company's cost basis)
After that you have to determine, whether it is long term gain, taxed only at 15%, or ordinary income. You do that by looking at the original purchase date of the old company. If it was bought more than 12 months before the merger or acquisition, you have a capital gain. Otherwise, it is a short-term gain, taxable as ordinary income unless you have capital losses to offset it.
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Wiki User
∙ 9y ago
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What is a cairn vedanta deal m and a?
merger and acquisition
What is the distinction in mergers and acquistitions?
The distinction in mergers and acquisitions means that the two words have different meanings. A merger is when a company merges or becomes part of another company. An acquisition is when a company out right buys another company.
What is business combinations?
may arise when one entity acquires control over to combines with another business by acquiring the share capital of another or the tow entities exchange their issued share capitals.
What is journal entry in merger in transferee company?
Debit combined assetsCredit combined liabilities
Why can't auditors invest in companies that they audit?
The main reason an auditor cannot invest in companies they audit is of course that there is a conflict of interest. An simple example of this would be an auditor, auditing Apple Inc's accounts, the auditor would have prior knowledge on the companies profit, which would not be public knowledge until the results are made public. Based on Apple's performance an auditor who have information that could be advantage regarding as another example the possible up or down side of the companies stock price. There are numbers other examples such as an auditor conducting due diligence on a merger and acquisition. But the main reason is a conflict of interest
What is the Definition of merger and acquisition?
What is merger and aquisition?
What does the concept of merger acquisition refer to?
A "merger" is what happens when two companies join to become one company. An "acquisition" is when one company purchases another company. An acquisition can also be called a "takeover".
What is a cairn vedanta deal m and a?
merger and acquisition
What are the theories of efficiency of Merger and acquisition?
Well in Star Trek, the "Ferengi" seemed to be the experts on acquisition.
What does merger and acquisition mainly deal with?
Merger and acquisition is the buying, selling, dividing and combing of different companies. This is done to help the company grow in its area with out using a joint venture.
How much do Merger Acquisition consultants make?
Merger Acquisition consulatants salary staring a new job is around the $ 100,000 dollars. Depending if you have worked a company related to the field.
Examples of mergers of companies?
Bank acquisition and merger in nigeria
What are some considerations when a company is considering a merger or acquisition?
With an acquisition or merger, the details connected with such things as taxes, corporate cultures, distribution of responsibilities, and logistics, among others, can be exceedingly complex.
How pharmacist affect by merger and acquisition of pharma companies?
You will die of cats
How does a merger differ from an acquisition?
A merger is different from an acquisition in that when two entities merge (whether partnerships, corporations, LLC's) neither one is "acquiring" the other. In an acquisition, there is usually a dominant entity who is taking over the smaller or suffering entity. In a merger, the two entities merge to form one new entity made up of the two former companies.
Who would use an investment bank?
A company or government looking to raise capital through the financial markets; a company looking to hedge its risk; a company seeking advice on a merger/acquisition.
What are the reasons for different sizes of firm?
Size of market Capital employed Organisation or structure of firm Barriers to entry No. Of employees Market share Rate of integrations it means merger and acquisition
