Principles of Private Firm Valuation
■ There are benefits to tax-free structures as well as substantial nontax costs. Tax-free acquisitions involve the exchange of a ...
■ The 338 election does not make sense when the parent’s tax basis in the sold subsidiary stock far exceeds its tax basis in its ...
147 TABLE 8.5 Financial Comparison of Taxable Acquisition of C and S Corporations Descriptive financial data for the sample of 7 ...
148 TABLE 8.5 (Continued) Panel C: Difference in financial measures between target organizational form Target OperatingCash Flow ...
149 TABLE 8.6 Transaction Multiples Comparison of purchase price multiples across target firm organizational form for 77 matched ...
150 TABLE 8.7 Acquisition Multiple Model Estimate of the effect of target organization form, method of payment and growth on acq ...
The organizational form variable is the measure of the S premium. The sign on the coefficient is positive and statistically sign ...
APPENDIX 8A: ACQUIRERS’ INDIFFERENCE PRICE EQUATIONS Indifference acquisition price between a stock and asset transaction for TC ...
153 CHAPTER Valuation and Financial Reports The Case of Measuring Goodwill Impairment 9 T he accounting rules governing business ...
goodwill.” If this value is less than the carrying value of a reporting unit’s goodwill, then there is goodwill impairment. This ...
necessary. Alternatively, “If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill im ...
156 TABLE 9.1 Balance Sheet for the Dr. Green Division of DDS Fair Market Fair Market Fair Market Fair Market Value Value of Val ...
impairment of the unit’s nongoodwill assets. The values of net plant and the customer list were each reduced by $50,000, respect ...
price of an individual equity security (and thus the market capital- ization of a reporting unit with publicly traded equity sec ...
The board’s thinking on using market prices of minority value shares to determine value of an entity is unambiguous. One cannot ...
indicating that marketplace participants would use different assump- tions. If such information exists, the entity must adjust i ...
Board members noted that a valuation technique similar to that used to value the acquisition would most likely be used by the en ...
the impairment date is likely to be different, and in some cases quite differ- ent, than at the acquisition or last impairment t ...
entities. This means that the synergy arising out of collective use of recog- nized assets is not valued separately but is effec ...
(3) Musical works such as compositions, song lyrics, advertising jin- gles T– (4) Pictures, photographs T– (5) Video and audiovi ...
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