Mr. and Mrs. FB each own 30 percent of the voting common stock of FB Inc. Four

Question:

Mr. and Mrs. FB each own 30 percent of the voting of FB Inc. Four unrelated investors each own 10 percent. Based on a recent appraisal, FB’s net worth is $10 million. Discuss the valuation issue suggested if:
a. Mr. and Mrs. FB give their combined 60 percent stock interest to their son.
b. An unrelated investor gives her 10 percent stock interest to her son.
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...