invic

Which of the following is least likely an example of a transaction-related valuation for a private company?

A) Financial reporting.

B) Bankruptcy proceeding.

C) Performance-based managerial compensation.

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Venture capital financing, initial public offering (IPO), bankruptcy proceeding, performance-based managerial compensation, and sale in an acquisition are all examples of transaction-related valuations for a private company.

invic

Which of the following is least likely an example of a transaction-related valuation for a private company?

A) Financial reporting.

B) Bankruptcy proceeding.

C) Performance-based managerial compensation.

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Venture capital financing, initial public offering (IPO), bankruptcy proceeding, performance-based managerial compensation, and sale in an acquisition are all examples of transaction-related valuations for a private company.

invic

Which of the following is least likely an example of a compliance-related valuation for a private company?

A) Bankruptcy proceeding.

B) Financial reporting.

C) Tax purposes.

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A bankruptcy proceeding is an example of a transaction-related valuation for a private company.

invic

Which of the following is least likely an example of a litigation-related valuation for a private company?

A) Lost profits claims.

B) Bankruptcy proceeding.

C) Divorce settlements.

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Litigation-related valuations may be required for shareholder suits, damage claims, lost profits claims, or divorce settlements. A bankruptcy proceeding is an example of a transaction-related valuation for a private company.

invic

Which of the following statements most accurately describes the difference between private and public firm managers?

A) Because managers in a public firm are often paid with incentive compensation, public managers may take a longer term view than private managers.

B) Although managers in a public firm are often paid with incentive compensation, public managers may take a shorter term view than private managers because shareholders often focus on the short-term.

C) Because managers in a private firm are concerned with having the firm go public, private managers may take a shorter term view than public managers.

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Although managers in a public firm are often paid with incentive compensation such as options, shareholders often focus on short-term measures such as quarterly earnings and the consistency of such. Management may therefore take a shorter term view than they otherwise would. Private firms should be able to take a longer term view.