Online Access Free ABV Exam Questions

are normally more valuable than minority shares because they contain a bundle of rights that minority shares do not enjoy.

• A.Strategic control
• B.Symergistic value
• C.Control shares
• D.Stock market value

The coverage of fixed charges is a more inclusive ratio than the times-interest-earned ratio in that:

• A.It includes coverage of the items in addition to interest
• B.It includes coverage of the items in addition to fixed earnings
• C.It excludes coverage of the items in addition to variable earnings
• D.It excludes coverage of the items in addition to interest

The formula to calculate the Business Risk is:

• A.Business Risk = Percentage change of Gross income / Mean of Gross income
• B.Business Risk = Percentage change of net income / Mean of net income
• C.Business Risk = Standard deviation of net income / Mean of net income
• D.Business Risk = Standard deviation of Gross income / Mean of net income

Recapitalizations involving debt securities may be undertaken for a variety of reasons. One common reason is:

• A.A leveraged Buyout
• B.A leveraged recapitalization
• C.Resource reallocation
• D.Bankruptcy recapitalization

When there is a choice among accounting practices, private companies tend towards a more conservative selection in order to minimize taxes, while public companies may account more aggressively in order to report:

• A.Treatment of intangible assets
• B.More income so as to please shareholders
• C.Asset values
• D.More benefits