What Level Are Inputs for Estimating Fair Values Based on a Firm's

question 66

Multiple Choice

What level are inputs for estimating fair values based on a firm's own assumptions about the fair value of an asset or a liability,such as using various data to estimate present values?

• A) Level 1.
• B) Level 2.
• C) Level 3.
• D) None of these.

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Definitions:

Noncash Assets

Assets that are not in the form of cash or cannot be easily converted to cash, such as property, plant, and equipment.

Par Value

This term describes the nominal or face value of a bond, stock, or coupon as stated by the issuer, often used in the context of bonds and shares.

Preferred Stock

a class of stock that typically provides dividends before dividends are distributed to common stockholders and may have priority over common stock in the event of liquidation.

Common Stock

Equity ownership in a corporation, with holders having a claim on the company’s profits in the form of dividends and voting rights in corporate governance.