How does intellectual capital affect the balance between a corporation's balance sheet and investor's estimation of corporate worth?
A) The balance sheet and estimated corporate worth are now equal.
B) The balance sheet value exceeds estimated corporate worth.
C) Estimated corporate worth exceeds the balance sheet value.
D) Intellectual capital has no effect on any difference between the balance sheet and estimated worth.
E) Intellectual capital makes it easier to justify the balance sheet.

Question

Quizplus · Accepted Answer

Intellectual capital such as patents, copyrights, and brand names can create value for a corporation that is not reflected on the balance sheet. As a result, estimated corporate worth can sometimes exceed the balance sheet value, indicating that investors recognize the value of a corporation's intellectual capital.

How Does Intellectual Capital Affect the Balance Between a Corporation's