1. Which one of these can be ignored when valuing a purchase versus a lease?
tax shield from depreciation
investment outlay for the asset
changes in operating costs related to the acquired asset
lease payments
taxes
2. Boston Company is planning on merging with Marrymount Company. Boston currently has 400,000 shares of stock outstanding at a market price of $28 a share. Marrymount has 175,000 shares outstanding at a price of $31 a share. The merger will create $1,050,000 of synergy. How many of its shares should Boston offer in exchange for all of Marrymount s share if it wants its acquisition cost to be $5,700,000?
190,397
182,766
175,508
168,412
197,644