Which of the following is most likely an advantage of an accelerated share repurchase (ASR) program over an open market share repurchase (OMR) program? Question options: a) ASRs allow a company to provide longer periods of stock price support versus an OMR. b) ASRs send a stronger signal to markets when disclosed versus OMRs. c) ASRs are taxed at the capital gains tax rate, which can be lower than the ordinary income tax rate on OMRs. d) ASRs are more flexible than OMRs.

Which of the following is most likely an advantage of an accelerated share repurchase (ASR) program over an open market share repurchase (OMR) program? Question options: a) ASRs allow a company to provide longer periods of stock price support versus an OMR. b) ASRs send a stronger signal to markets when disclosed versus OMRs. c) ASRs are taxed at the capital gains tax rate, which can be lower than the ordinary income tax rate on OMRs. d) ASRs are more flexible than OMRs.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter8: Fraud, Internal Controls, And Cash

Section: Chapter Questions

Problem 17MC: What would be a reason a company would want to understate income? A. to help nudge its stock price...

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Question

Which of the following is most likely an advantage of an accelerated share repurchase (ASR) program over an open market share repurchase (OMR) program?

Question options:

a)	ASRs allow a company to provide longer periods of stock price support versus an OMR.

b)	ASRs send a stronger signal to markets when disclosed versus OMRs.

c)	ASRs are taxed at the capital gains tax rate, which can be lower than the ordinary income tax rate on OMRs.

d)	ASRs are more flexible than OMRs.

Definition Definition Tax imposed by the government on the "gain" or increase in the value of an asset at the time of its sale by the owner. Capital gain is computed based on the purchase price and sale price of the asset. If the sale price of the asset is more than the purchase price, there is a gain on the sale of asset. A tax is imposed on such gain in accordance with the applicable tax rates at the time of sale.

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