What best describes how much a company is worth?
A) An exact science
B) An educated guess
C) Explicit accounting standards
D) Known only to the firm's accountants
E) Static

Question

Quizplus · Accepted Answer

The worth of a company is not an exact science as it involves several factors such as market trends, competition, and economic conditions. It requires an educated guess based on financial statements, performance indicators, and other relevant information.

Answer: C 
 Explicit accounting standards can provide some guidance on how to value certain assets and liabilities, but it does not provide a comprehensive valuation of the entire company.

Answer: D 
 While the firm's accountants may have some insight into the company's worth, it is not solely known to them. Other stakeholders such as investors, analysts, and regulators may also have an interest in knowing the company's worth.

Answer: E 
 Company worth is not static and can change over time based on various factors such as financial performance, market trends, and external events. Therefore, it cannot be described as static.

What Best Describes How Much a Company Is Worth