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Python Corp specializes in buying troubled business and squeezing them dry by firing a large percentage of their employees and selling them again at a
Python Corp specializes in buying troubled business and squeezing them dry by firing a large percentage of their employees and selling them again at a profit. In 20x1, Python pays $10,000,000 to its investment banker, Stalker, to evaluate the acquisition of several failing businesses. Assume that in 2021 Stalker evaluates 20 businesses and recommends 8 to Python. Python does not make an offer to buy any of the 8 recommended companies until 2022. Also assume that the $10,000,000 can be allocated equally among all the 20 businesses investigated and that Python deducted the full $10,000,000 on its AFS.
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