Which of the following is true of the standards of value used in business valuation?
A) The fair value proposes a hypothetical sale in an open and unrestricted market.
B) The investment value is often used in dissenting minority interest litigation.
C) The book value of a business rarely represents its fair market value.
D) The fair market value is usually greater than the investment value.

Question

Quizplus · Accepted Answer

The book value, which is a financial accounting concept representing the value of a company's assets minus its liabilities, often does not reflect the current market value or the price that could be obtained if the business were sold. This is because book value does not take into account intangible assets, future earning potential, or market conditions, among other factors, that can significantly influence a company's value in the marketplace.

Which of the Following Is True of the Standards of Value