The total after-tax pro-forma adjustment to Amazon's net earnings is expected to be: ($44,442) ($31,109) ($22,711) $57,774

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Acquisition of Facebook by Amazon
PP&E, Goodwill and Other Intangibles Assumptions
Total Book Value of PP&E, Goodwill and Other Intangibles
FMV of PP&E, Goodwill and Other Intangibles
FMV of PP&E, Goodwill and Intangibles Attributed to Depreciable Property
S71,505
$766,981
71.50%
FMV of PP&E, Goodwill and Intangibles Attributed to Non-Depreciable Property 28.50%
Average Amortization Period (Years)
13.5 Years
Debt Assumptions
Debt issued for acquisition of Facebook
$187,038
Interest on New Debt
4.0%
Term of New Debt
10 Years
New Debt Financing Fees
0.5%
Other Assumptions
Other Transaction Costs
$20
Efective Tax Rate
30.0%
Amazon Net Earnings
Facebook Net Eamings
$23,688
S30,133
15
The total after-tax pro-forma adjustment to Amazon's
net earnings is expected to be:
($44,442)
($31,109)
($22,711)
$57,774
Transcribed Image Text:Acquisition of Facebook by Amazon PP&E, Goodwill and Other Intangibles Assumptions Total Book Value of PP&E, Goodwill and Other Intangibles FMV of PP&E, Goodwill and Other Intangibles FMV of PP&E, Goodwill and Intangibles Attributed to Depreciable Property S71,505 $766,981 71.50% FMV of PP&E, Goodwill and Intangibles Attributed to Non-Depreciable Property 28.50% Average Amortization Period (Years) 13.5 Years Debt Assumptions Debt issued for acquisition of Facebook $187,038 Interest on New Debt 4.0% Term of New Debt 10 Years New Debt Financing Fees 0.5% Other Assumptions Other Transaction Costs $20 Efective Tax Rate 30.0% Amazon Net Earnings Facebook Net Eamings $23,688 S30,133 15 The total after-tax pro-forma adjustment to Amazon's net earnings is expected to be: ($44,442) ($31,109) ($22,711) $57,774
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