Final answer:
The valuation method used for community property during marriage commonly involves market sales valuation, estimating fair market value, while capitalization of past excess earnings is a less common alternative.
Step-by-step explanation:
The valuation method used during marriage for community property (CP) can vary depending on the jurisdiction and the specific circumstances of the couple's assets. However, in general, a common valuation method is market sales valuation, which determines the fair market value of an asset based on what it would sell for in the current market. Another approach, although less common in the context of marital assets, is the capitalization of past excess earnings, which is a method used to estimate the future earnings potential of a business based on historical earnings data.
When a large number of shareholders own a company, an important question to consider is how and when the company obtains money from its sale. This typically occurs when the company is sold, merged, or undergoes an initial public offering (IPO), which leads to the distribution of proceeds to the shareholders based on their ownership percentages.