If You Were Appraising a Church, Which Approach to Value

question 9

Multiple Choice

If you were appraising a church, which approach to value would be best to use?

• A)sales comparison approach
• B)cost approach
• C)income capitalization approach
• D)revenue multiplier

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Definitions:

Sustainable Growth Rate

The maximum rate at which a company can grow its sales, earnings, and dividends without incurring new debt.

Debt-equity Ratio

An indicator that differentiates the financing portion between debt and equity for company assets.

External Financing

Funds a company acquires from outside sources, such as bank loans, issuing bonds, or selling stock, to support its operations and growth initiatives.

Full Capacity

Full capacity refers to the maximum level of output that a company can sustain over a period, utilizing all available resources efficiently.