medium · Private Equity accounting-flow
A buyer pays $100M for a target in an asset purchase. The PPA allocates $20M to tangible assets (5-year life) and 80M to goodwill/intangibles (15-year life).
If the tax rate is 25%, what is the annual cash tax shield created by the transaction?
- 2.33M
- 9.33M
- 25.00M
- 1.33M
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