The Preferred Method of Determining Fair Value of Transactions Is

question 66

Multiple Choice

The preferred method of determining fair value of transactions is:

• A)market-based values.
• B)basing them on reasonable management assumptions.
• C)external auditor estimates.
• D)detailed computations by outside experts.

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Definitions:

Annual Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits on a per-share basis each year.

Dividend Growth Model

A model that estimates the value of a company's stock based on its expected future dividends and their growth rate.

Market Rate

The market rate, often referred to as the going rate, is the standard or average interest rate, wage, or price charged or paid for a specific good, service, or asset in a specific market.

Equity Securities

Financial instruments that represent ownership interest in a company or corporation, such as common stock.