CEPA Online Program
Session 1 CE Answers
Answers you previously submitted are listed below each question. Correct answers in GREEN.
Module 1 Question 1: What survey indicated that exit strategy is a priority for younger generation business owners?
- State of Owner Readiness (Correct Answer)
- Fishing for Value
- State of CEPA
- Walking to destiny
YOUR ANSWER: NA
Module 1 Question 2: It's important to not just tell an owner the right answer, but to ask them the right question. Which is an example of the "right question" to ask a business owner client?
- What is the strength of your intangible capital?
- What is your biggest pain point and biggest desire?
- What deal structure are you looking for when selling?
- All of the above (Correct Answer)
YOUR ANSWER: NA
Module 2 Question 1: Complete this sentence: A successful exit strategy balances the “____ Legs of the Stool.”
- Two
- Three (Correct Answer)
- Four
- Five
YOUR ANSWER: NA
Module 2 Question 2: What is the cause of “sellers’ cold feet” during the sale of a business?
- Insufficient human capital
- Lack of personal planning (Correct Answer)
- Beginning the exit planning process too early
- Understanding value acceleration
YOUR ANSWER: NA
Module 2 Question 3: What is the first stage in the "Five Stages of Value Maturity?"
- Identify (Correct Answer)
- Protect
- Build
- Harvest
YOUR ANSWER: NA
Module 2 Question 4: When ranking a business’s intangible capitals, what is the main purpose of using the “Common Sense Scoring Scale” of 1-6?
- There are six rankings to match the six intangible capitals
- The 1-10 scale is overused
- It's the easiest way to compare one intangible capital to another
- It forces you to not choose "average" (Correct Answer)
YOUR ANSWER: NA
Module 2 Question 5: Which style of business is more likely to generate better income and sell at a premium?
- Lifestyle
- Freestyle
- Value Creator (Correct Answer)
- All of the above
YOUR ANSWER: NA
Module 2 Question 6: The four intangible capitals (The 4 Cs) include the Human, Structural, Social, and __ capitals.
- Financial
- Consumer
- Customer (Correct Answer)
- Value
YOUR ANSWER: NA
Module 2 Question 7: An independent personal, financial, and business assessment correlated to business range of value is referred to as:
- The Triggering Event (Correct Answer)
- The Discover Gate
- The Prioritized Action Plan
- The Exit Plan
YOUR ANSWER: NA
Module 2 Question 8: Value Acceleration is grounded in:
- Action (Correct Answer)
- Data
- 90-Day Sprints
- Success
YOUR ANSWER: NA
Module 2 Question 9: Complete the following equation: R/EBITDA x Market Multiple = ______
- Sales
- Cash Flow
- Value (Correct Answer)
- Income
YOUR ANSWER: NA
Module 2 Question 10: Which of the following is not a Gate in the Value Acceleration Methodology?
- Prepare
- Plan (Correct Answer)
- Discover
- Decide
YOUR ANSWER: NA
Module 3 Question 1: The typical business owner has ____% of their net worth tied up within their business.
- 20%
- 40%
- 60%
- 80% (Correct Answer)
YOUR ANSWER: NA
Module 3 Question 2: What is a benefit of prioritizing wealth management for a business owner?
- Tax efficiency
- Insurances in place (Risk Management)
- Structured cash flow
- All of the above (Correct Answer)
YOUR ANSWER: NA
Module 3 Question 3: Life insurance, health insurance, and product liability insurance all fall under which section of the financial planning process?
- Investment Management
- Risk Management (Correct Answer)
- Cash flow management
- Volatility management
YOUR ANSWER: NA
Module 3 Question 4: Which of the following best describes the components of integrated wealth management for individuals?
- Portfolio management, disability planning, estate planning, life coaching
- Investment management, estate planning, property risk management, estate tax planning
- Investment management, disability planning, estate planning, income tax planning
- Retirement planning, risk management, estate planning, portfolio management (Correct Answer)
YOUR ANSWER: NA
Module 3 Question 5: Complete the following equation: Wealth Goal – Current Net Worth (Not Including Business Value) = ______
- Profit Gap
- Wealth Gap (Correct Answer)
- Value Gap
- Reality Gap
YOUR ANSWER: NA
Module 3 Question 6: Which of the following is an area of wealth management that cannot be controlled by the business owner?
- Cash Flow
- Risk Management
- Investments
- Taxes (Correct Answer)
YOUR ANSWER: NA
Module 3 Question 7: Which of the following is an example of a question that financial planning can answer for a business owner?
- How much money do I need to sell my business for?
- What rate of return do I need on my investments?
- What is the current volatility of the stock market?
- All of the above (Correct Answer)
YOUR ANSWER: NA
Module 3 Question 8: A(n) ________ provides for the stability and continuity of a closely held business and is a crucial part of a business owner’s overall succession and estate plan.
- Risk Management Assessment
- Buy-sell agreement (Correct Answer)
- Exit Plan
- Investment Portfolio
YOUR ANSWER: NA
Module 3 Question 9: Which of the following is NOT an example of information that is typically found on an owner’s balance sheet?
- Cash Reserve's Structure
- Asset Protection
- Interest Deductibility
- Results Matrix (Correct Answer)
YOUR ANSWER: NA
Module 3 Question 10: If the client’s goal is to have $15 million for post-business retirement life, but their current net worth (without the business asset) is only $4 million, what would be their Wealth Gap?
- $15 Million
- $19 Million
- $11 Million (Correct Answer)
- $4 Million
YOUR ANSWER: NA
CEPA Module 4 Question 1: Which one of the following statements is not true?
- A decedent's unused federal estate tax exemption may be used by the surviving spouse
- All states have an estate tax (Correct Answer)
- The most efficient use of the federal estate/gift exemption is during life
- A gift received by a person is not taxable income
YOUR ANSWER: NA
Module 4 Question 2: The main goal of minimizing wealth tax is to:
- Maximize the client’s portion of earnings and minimize the IRS’s portion (Correct Answer)
- Minimize the client’s portion of earnings and maximize the IRS’s portion
- Create equality between both the client’s and the IRS’s portion of earnings
- Increase the amount of earnings placed towards trusts
YOUR ANSWER: NA
Module 4 Question 3: Which of the following is a disadvantage of an intentionally defective grantor trust (IDGT)?
- IDGT continues for multiple generations without being subject to federal estate tax
- Gifts to an IDGT do not trigger capital gains
- States impose higher taxes on IDGT
- The client cannot be a beneficiary (Correct Answer)
YOUR ANSWER: NA
Module 4 Question 4: A strategy which makes assets difficult or impossible to reach is called:
- Asset insurance
- Asset limitation
- Asset protection (Correct Answer)
- Asset placement
YOUR ANSWER: NA
Module 4 Question 5: What are the benefits for the business owner and family for integrating charitable contributions?
- Transferring values and purpose, not just assets
- Creating intergenerational common ground to collaborate, make joint decisions, gain confidence, develop/fulfill potential
- Developing an emotional and functional bridge between wealth, purpose, and society
- All of the above (Correct Answer)
YOUR ANSWER: NA
Module 4 Question 6: Which of the following is an example of an asset that may be gifted?
- Cash
- Insurance policies
- Illiquid assets
- All of the above (Correct Answer)
YOUR ANSWER: NA
Module 4 Question 7: The ____ can defer capital gains taxes on the sale of almost any type of highly appreciated asset.
- Intermediated Installment Sale Trust (Correct Answer)
- Asset Protection Continuum
- Decedent's Trust
- Intentionally Defective Grantor Trust
YOUR ANSWER: NA
Module 4 Question 8: When should a client use an Intentionally Defective Grantor Trust? (IDGT)
- When they are looking to defer capital gains taxes on investment properties
- When they are looking to avoid a lawsuit
- When they have high-basis assets and are looking to transfer those assets outside their estate (Correct Answer)
- When they have low-basis assets and are looking to transfer those assets outside their estate
YOUR ANSWER: NA
Module 4 Question 9: What is a reason as to why an organization may say “no” to some direct gifts?
- They are looking to minimize their wealth tax
- It doesn't further their mission (Correct Answer)
- They are accepting of the cost burden
- They prefer bonus gifts
YOUR ANSWER: NA
Module 4 Question 10: What is the primary objective for most Irrevocable Trusts of Family Limited Partnerships?
- Remove the business (or other asset) and future appreciation out of the estate (Correct Answer)
- Pay less corporate income tax to state
- Pass 100% of the estate to family members
- All of the above
YOUR ANSWER: NA
Module 5 Question 1: Which of the following is a common consequence of a business owner’s “achievement addiction?”
- The owner is not focused and unable to form any habits
- The owner begins to lose their enjoyment of competition
- The owner begins to look for the wrong things to replace the adrenaline rush (Correct Answer)
- The business begins to decline in revenue
YOUR ANSWER: NA
Module 5 Question 2: Hedonic happiness can be best described as:
- Pursuing pleasant experiences and avoiding painful ones (Correct Answer)
- Pursuing authenticity, meaning, virtue, and growth
- Pursuing success, achievement, and money
- Pursuing spiritual, things, experiences, and people (S.T.E.P)
YOUR ANSWER: NA
Module 5 Question 3: A business owner’s purpose should be made up of:
- Clarity, Realism, Balance
- Identity, Power, Status
- Time, Accomplishment, Social Connections
- Gifts, Passion, Values (Correct Answer)
YOUR ANSWER: NA
Module 5 Question 4: A business owner’s personal plan should include which of the following?
- Written estate plan
- Written and updated will
- Personal risk assessment
- All of the above (Correct Answer)
YOUR ANSWER: NA
Module 5 Question 5: When discussing topics related to personal planning with business owner clients, advisors should follow the 80/20 rule, which means:
- Let the client do 20% of the talking, while advisors do 80% of the talking
- Let the client do 80% of the talking, while advisors do 20% of the talking (Correct Answer)
- Let clients do 80% of the planning, while advisors do 20% of the planning
- Let clients do 20% of the planning, while advisors do 80% of the planning
YOUR ANSWER: NA
Module 5 Question 6: In which gate of the Value Acceleration Methodology™ should you conduct an assessment of the owner’s personal plan?
- Discover (Correct Answer)
- Prepare
- Decide
- Both Discover and Prepare
YOUR ANSWER: NA
Module 5 Question 7: The idea of opening up more time for a business owner to pursue new opportunities, while simultaneously allowing them to still be involved with the business can best be described as:
- A clear vision
- A purpose
- A paradox
- An offramp (Correct Answer)
YOUR ANSWER: NA
Module 5 Question 8: Which of the following is NOT traditionally included inside an owner’s personal plan?
- Personal Risk Assessment
- Written Estate Plan
- Guided Conversation Template (Correct Answer)
- Personal Readiness Assessment
YOUR ANSWER: NA
Module 5 Question 9: In the client example of business owner “Bert”, what ultimately led Bert to being enthusiastic about the next chapter of his life, instead of being afraid?
- Realizing he had enough money from the sale of the business to close his Wealth Gap
- Realizing he could still structure a fulfilling life, just one with different success metrics than before (Correct Answer)
- Realizing he would finally have the time to check off remaining items on his bucket list
- Realizing he could still live a fulfilling life even if it was no longer metrics driven
YOUR ANSWER: NA
Module 5 Question 10: Which of the below is an example of how you can prove to a client you are practicing active listening?
- Paraphrasing what the client said back to them (Correct Answer)
- Following the 80/20 rule
- Explaining to the client what differentiates you from the competition
- Ensuring your personal purpose matches that of the client
YOUR ANSWER: NA