BU Corporate Accounting Unit 4 VALUATION OF SHARES Imp Questions With Answers

Corporate Accounting is a special branch of accounting which deals with the accounting for companies ,preparation of their final accounts and cash flow statements, analysis and interpretation of companies’s financial results and accounting for specific events like amalgamation, absorption, preparation of consolidated

1. What us the need for doe valuation of shares?

In most cases, stock exchanges quotations are taken as the values of shares. But in some circumstances the stock exchanges quotations are not available for some shares or they may be inadequate doe the determination of values of shares of a company

2.State the methods of valuation of shares?

1.Assets banking, Net assets methods, balance sheet methods, Intrinsic values methods or Break Up values methods
2.Yield methods, dividend yield methods, or market values on dividend Yield methods
3.Earning capacity methods
4.Fair Values methods

3.Mention four circumstances under which shares have to be valued

.The Circumstances under which shares have to be valued areas under
a. At the time of amalgamation of companies
b.At the time of absorption of one company by another company
c.When a large block of shares is purchased so as to acquire controlling interst in the company.
d.When shares of one class are converted into shares of another class

4.How do you calculate the values of shares under the Break-up values method?

Under Break-Up Values Methods; Value of Share= Net Assets/Number of equity shares


BU Corporate Accounting Unit 5 COMPANY FINIAL ACCOUNT Imp Questions With Answers