The main purpose of a market-value balance sheet is to:
A) show an inflated value of the firm.
B) avoid the recording of certain liabilities.
C) value assets and liabilities without GAAP restrictions.
D) improve the credit rating of the firm.

Question

Quizplus · Accepted Answer

The main purpose of a market-value balance sheet is to value assets and liabilities without restrictions imposed by GAAP (Generally Accepted Accounting Principles). This method provides a more accurate reflection of the current market value of a company's assets and liabilities. It is not meant to show an inflated value of the firm, avoid recording certain liabilities or improve the credit rating of the firm.

The Main Purpose of a Market-Value Balance Sheet Is To