The United State is by far the world leader in markets for both publicly traded securities and closely
held businesses and business interests. Two factors have combined to accelerate the spread of U.S
technology in financial appraisals and market throughout the world. Which of the following is/are of
those factors?
A, B
When specifying, who is to provide the valuation services, the important distinction is whether the
client is retaining the appraisal firm itself or the individual appraiser employed by the firm. The
common practice is:
B
S corporations, limited liability corporations, limited liability partnerships, family limited
partnerships, professional corporations, real estate investment trust, investment companies
registered under the investment company act of 1940 and personal holding companies are the
examples of:
C
The definition of specific business interest can be broken down into two broad questions:
1)-Is the valuation to be a valuation of assets or a valuation of securities?
2)-In either case, exactly what assets or what securities are subject to valuation? By securities in
above context, we mean:
B
Valuation of ___________must be specified. For example, the assignment might include language
such as” ...engaged to estimate the fair market value of the fixed assets, inventory, and goodwill, on
a going-concern basis of...”
A
Which one of the following is NOT always clearly defined? Therefore, if the term is used, it should be
supplemented by a definition of exactly what it means in the given valuation context.
C
Unfortunately, the term enterprise value is used, at best, very ambiguously and, at worst, very
carelessly. It means different things to different people, each of whom many believe that his or her
definition is the right definition. It is generally used to represent some sort of ________of the
company and is often used as a synonyms for_______.
B
The primary ownership interest characteristics that need to be addressed in almost every business
valuation are the following EXCEPT:
C, D
In most business valuations, the opinion of value will be based at least partly on other, similar
transactions, such as:
C
In a marital dissolution the parties may be concerned with the change in value that occurred during
the marriage. In estate cases, the trustee, the executer, or personal representative will consider
adopting the “alternative valuation date”(i.e. six months after the date of death) to determine which
is more advantageous. These are the examples of:
B
In ________cases, the valuation date itself is an issue to be resolved by the court. In such situations,
the appraiser must be prepared to address the valuation as of several dates, sometimes without
knowing which date the court determined to be relevant until after the judgment is rendered. Since
the choice of valuation date in such cases is a legal matter.
A
Valuation reports should contain a set of limiting conditions, and one of the typical limiting
conditions is as follows:
B
“The amount at which property would change hands between a willing seller and a willing buyer,
when neither is acting under compulsion and when both have reasonable knowledge of the relevant
facts”. This definition is related to:
B
“Market value is the most probable price which a property should bring in a completive and open
market under all conditions requisite to fair sale the buyer and seller each acting prudently and
knowledgeably, and assuming the price is not affected by undue stimulus.” Implicit in this definition
is the consummation of a sale as of a specified date and the passing of title from seller to buyer
under conditions/s whereby:
A, B, C
Virtually, all businesses or interests in businesses may be appraised under some alternatives
premises of value. Which of the following is not out of those premises?
D