Week 7 Homework Quiz

Business military ranks Homework ES 1. (TCO G) A rating professional who holds a CVA has the credentials of a (Points 2) Continuous rating analyst. Cost valuation of assets. x Certified valuation analyst. none of the to a higher place is correct 2. (TCO G) If a shareholder in a closely held championship sells his or her stock, the valuation professional typically would (Points 2) improver the assess somewhat to get the minority owner out of the business. Do a standard professional valuation in which the minority bear on issue is ignored. Discount the cheer somewhat to reflect the diminished value of being a minority interest holder. Always economic consumption a historical cost basis analysis to take conservatism into account. no(prenominal)e of the to a higher place is correct. 3. (TCO G) The most commonly accepted methods of business valuation use some form of (Points 2) Balance sheet analysis.Historical cost basis. Book value method. x Income statement approach. 4. (TCO G) The conclusions presented in FASB No. 157 support which FASB Conceptual model? (Points 2) FASB Conceptual Framework No. 2 FASB Conceptual Framework No. 6 FASB Conceptual Framework No. x All of the above no(prenominal) of the above 5. (TCO G) The major business valuation organization that has authentic rigorous business valuation standards is (Points 2) The National Association of Business Valuation Analysts (NACVA) The American Society of Appraisers (ASA) The Institute of Business Appraisers, Inc. (IBA) x All of the above None of the above 6. (TCO G) In a typical business valuation report, one exhibit that is seldom used is (Points 2) Limiting conditions. Definitions of valuation terms. symmetry analysis of the company. Common size balance sheets of the company. None of the above. 7. (TCO G) Equitable dispersion in divorce cases is driven by (Points 2) The Uniform Commercial reckon nationally. x Individual state laws. Supreme Court rulings. Professional standards. None of the above. 8. (TCO G) A minority interest in a business (Points 2) technically is less than a 50-percent ownership in the business Might be worth less than a pro-rata share of the business value whitethorn have limited influence in the operations of the business x All of the above None of the above 9. (TCO G) IRS Rev. Rul. 59-60 (Points 2)Deals with the valuation of closely held businesses Provides a list of eight factors that should be considered in valuing a closely held business Is particularly useful for valuing closely held businesses in estate and gift taxation situations x All of the above None of the above 10. (TCO G) Preparing common-sized financial statements and playacting ratio analyses of financial statements are examples of (Points 2) Customizing financial statements. Downsizing financial statements. x Spreading financial statements. Simplifying financial statements. None of the above.