Question

Valuations are required in the following situations (other than sale of business)

A) A: Merger, B: Financial reporting; C: Strategic planning, D: Ignoring valuations
B) A: Ignoring valuations, B: Strategic planning; C: Merger, D: Financial reporting
C) A: Financial reporting, B: Ignoring valuations; C: Strategic planning, D: Merger
D) A: Merger, B: Strategic planning; C: Financial reporting, D: Ignoring valuations

Answer 1

Valuations are required in various situations such as merger, financial reporting, and strategic planning.

Step-by-step explanation:

Valuations are required in various situations in addition to the sale of a business. These situations include:

1. Merger: When two or more companies combine their operations, valuations help determine the fair value of each company involved.
2. Financial reporting: Valuations are necessary for reporting the value of assets, liabilities, and equity accurately.
3. Strategic planning: Valuations provide insights into the value of different options, helping companies make informed decisions.

Therefore, the correct combination of situations requiring valuations is A) Merger, B) Financial reporting, and C) Strategic planning.