Which statement is false about valuation based on comparable

Assignment Help Financial Accounting
Reference no: EM132869493

Question 1: Which of the following statement is FALSE about valuation based on comparable firms?

A. We can estimate the value of a firm's shares by multiplying its current earnings per share by the average P/E ratio of comparable firms.

B. Although valuation multiples technique is simple to use, it relies on some very strong assumptions about the similarity of the comparable firms to be firm you are valuing

C. Using multiples will not help us determine an entire industry overvalued

D. None of the above.

Reference no: EM132869493

Questions Cloud

Beck manufacturing and plant capacity : Calculate the capacity of each machine center and the capacity of the system.
Difference between an equity security and a debt security : What is the difference between an equity security and a debt security? Please provide an example of each
What is hot shot company cost of common stock equity : The Hot Shot Company's common stock has a beta of 1.4. The risk-free rate is 3%, and the market return is 11%. What is HSC's cost of common stock equity?
Discuss implications of baldrige criteria for e-commerce : Discuss the implications of the Baldrige Criteria for e-commerce. What are the specific challenges that e-commerce companies face within each category of the cr
Which statement is false about valuation based on comparable : Which statement is FALSE about valuation based on comparable firms? Using multiples will not help us determine an entire industry overvalued
Articles on customer loyalty measurement : Provide a very detailed summary on articles on Customer Loyalty Measurement
What was allen free cash flow in millions : Allen's cash outflow for fixed assets and increased net operating working capital totaled $0.6 million. What was Allen's free cash flow in millions
Experiencing low employee motivation : JLB Enterprises is a computer manufacturer that is experiencing low employee motivation.
What type of hedge fund must have a net position : What type of hedge fund must have a net position that is always short? Why do private equity managers often have access to legitimate inside information?

Reviews

Write a Review

Financial Accounting Questions & Answers

  What is the present value of that amount

Problem - You will receive $1,000 in five years. What is the present value of that amount if you earn 10% interest compounded annually

  What amount of interest expense will be recorded

What amount of interest expense will be recorded in the December 31, 2015, annual income statement - Interest is paid semiannually

  Prepare Splish journal entry to record profit or loss

Prepare Splish's journal entry to record profit or loss, if any, using (a) the percentage-of-completion method and (b) the completed-contract method

  Interested in seeing how the money grow

Gen is interested in seeing how the money grows. Her mom suggests that she takes the money in her piggy bank and deposits it in a local bank paying 8.5% compounded quarterly. IF she finds $700 in the piggy bank, how much will it grow to in 10 years?

  Why does audit standards require the second set

Does it make a difference that analytical procedures were performed in testing property, plant, and equipment, as indicated by BK&D CPAs?

  What are call provisions and sinking fund provisions

What are call provisions and sinking fund provisions? Do these provisions make bonds more or less risky

  Provide the accounting entries necessary to account

Provide the accounting entries necessary to account for the above purchase by the Australian company for the year ending 31 December 2019

  Make an amortization table for the bonds payable

What is the interest expense for 2016 and 2017, respectively? What is the carrying amount of the bonds on December 31, 2017 and 2018, respectively?

  What is the maximum deduction that would be allowed

What is the maximum deduction that would be allowed from the farm loss for the 2020 tax year? A taxpayer recognized a $40,000 loss in 2020 from a small farm

  What do feel concerning such a proposal

No exemptions and that all would therefore be carrying their fair, equitable tax burden. What do you feel concerning such a proposal?

  What amount did retained earnings increase or decrease

On November 1 of the current year, Rob Elliot invested $31,000.00. By what amount did retained earnings increase or decrease during the period?

  Subtracting out the time-value of the annual benefits

On January 1, 2000 an insurance company has a lump-sum of 450000 which is due to Linden as a life insurance death benefit. He (Linden) chooses to receive

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd