NACVA NACVA Certification CVA Questions & Answers

• Question 11:

  Analysts should consider each of the following measure when estimating the remaining useful life of intangible asset EXCEPT:

  A. Remaining legal (or legal protection) life (e.g., remaining term of trademark protection)

  B. Remaining contractual life (e.g., remaining term on a lease)

  C. Remaining copyrighted life (e.g., time period for which copyrights are sold)

  D. Remaining technological life (e.g., period until the current technology becomes obsolete, for patents, proprietary processes, etc.)

  Correct Answer: C

• Question 12:

  An intangible's deficiencies are considered curable when the prospective economic benefit of enhancing or modifying it exceeds the current cost (in terms of material, labor, and time) to change it. An intangible's deficiencies are considered incurable when:

  A. The current costs of enhancing or modifying it (in terms of material, labor and time) cannot exceed the expected future economic benefits of improving it

  B. The current costs of enhancing or modifying it (in terms of material, labor and time) exceed the expected future economic benefits of improving it

  C. Cost encompasses all of the deficiencies

  D. Reproduction cost exceeds the actual production cost

  Correct Answer: B

• Question 13:

  The cost approach provides a systematic framework for estimating the value of an intangible asset based on the economic principle of:

  A. Substitution

  B. Competition

  C. Double counting

  D. Asset-based approach

  Correct Answer: A

• Question 14:

  Which of the following is NOT a common category of intangible assets?

  A. Technology-related

  B. Human-capital-related

  C. Location-related

  D. Data warehousing-related

  Correct Answer: D

• Question 15:

  ____________ is a specialized classification of intangible and its categories are creative (e.g. copyrights) and innovative (e.g. patents).

  A. Intellectual properties

  B. Intellectual capital

  C. Both A and B

  D. Intellectual rights

  Correct Answer: A

• Question 16:

  Which of the following attribute should be there for an intangible asset to exist from an economic perspective?

  A. It should be subject to legal existence and protection

  B. It should be subject to specific identification and recognizable description

  C. It should be subject to right of private ownership

  D. All of these

  Correct Answer: D

• Question 17:

  All of the various tangible personal property valuation method and procedures can be grouped into the following approaches EXCEPT:

  A. The work-in-process inventory of a professional services firm

  B. The merchandise inventory of a manufacturer/processor or of a wholesale/retail company

  C. Final valuation reconciliation

  D. Financial asset account categories

  Correct Answer: CD

• Question 18:

  The work-in-process inventory of a professional service firm is essentially the unbilled receivables of the firm. Therefore, the same net realizable value rules discussed with respect to accounts and notes

  receivable would apply to this asset as well. With regard to tangible merchandise inventory, there are some common valuation methods such as:

  A. The cost of reproduction method

  B. The income expenditure method

  C. The comparative sales method

  D. A and C

  Correct Answer: D

• Question 19:

  Which of the following factors is NOT considered, among others, when determining if quantitative adjustments to the sales comparison data are necessary?

  A. Age of each transaction

  B. Land-to-building ratio of each property

  C. Absolute location and relative location of each property in relation to population centers, highways, and so forth

  D. Safety aspects of each property

  Correct Answer: D

• Question 20:

  The sales comparison approach is based on the economic principles of:

  A. Efficient markets

  B. Special financing and other terms regarding each sales transactions

  C. Age of each property

  D. Supply and demand

  Correct Answer: AD