A Private-Placement Memorandum Is

question 101

Multiple Choice

A private-placement memorandum is:

• A) a notice to the SEC about a non-registered security sale that is occurring
• B) a contract signed by the buyer of an unregistered security in which they recognize they are buying risky, unregistered securities
• C) information to investors in unregistered securities that is similar to a prospectus
• D) a note placed in the permanent files of an unregistered security offering detailing the offer
• E) none of the other choices

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Definitions:

Equity Method

A financial recording method for logging investments in subsidiary entities where the investor has considerable sway but lacks complete dominance.

Goodwill

An intangible asset that arises when a company acquires another business for a price higher than the fair value of its identifiable net assets.

Equity Method

An accounting technique used when an investor holds significant influence but not full control over an investee, allowing the investor to record a proportionate share of the investee's profits or losses.

Consolidated Balance Sheet

A financial statement that presents the assets, liabilities, and equity of a parent company and its subsidiaries as one entity.