Abandonment Value

AAA

DEFINITION of 'Abandonment Value'

The value of a project or asset if it were immediately liquidated or sold. The abandonment value of an asset or project can vary for a variety of reasons including liquidity, supply-demand factors and implied fair value appraisals performed by certified appraisers.

Also referred to as the liquidation value.

INVESTOPEDIA EXPLAINS 'Abandonment Value'

The abandonment value is generally a cash value, or equivalent, associated with an asset. This value is important for companies when analyzing the profitability of particular projects or assets and deciding whether they should be maintained or abandoned. Abandonment values are also an important factor in bankruptcy proceedings, where assets are typically sold at distressed or liquidation prices.

RELATED TERMS
  1. Amenity

    Benefits of a property whose existence increase the value or ...
  2. Abandonment

    1. The act of surrendering a claim to, or interest in, a particular ...
  3. Abandonment Option

    A clause granting parties the option of withdrawing from the ...
  4. Cash And Cash Equivalents - CCE

    An item on the balance sheet that reports the value of a company's ...
  5. Bankruptcy

    A legal proceeding involving a person or business that is unable ...
  6. Appraisal

    A valuation of property (ie. real estate, a business, an antique) ...
Related Articles
  1. Finding Per Diem Rates
    Budgeting

    Finding Per Diem Rates

  2. Understanding 'Per Diem'
    Budgeting

    Understanding 'Per Diem'

  3. Material Adverse Effect A Warning Sign ...
    Markets

    Material Adverse Effect A Warning Sign ...

  4. Footnotes: Early Warning Signs For Investors
    Retirement

    Footnotes: Early Warning Signs For Investors

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center