Legacy Asset

AAA

DEFINITION of 'Legacy Asset'

An asset that has been on the company's books for a long period of time. This type of asset has generally decreased in value to the point of a loss for the company. The term comes from the literal meaning of outdate or obsolete.

INVESTOPEDIA EXPLAINS 'Legacy Asset'

While these assets are generally considered a hinderance, it may be a good time to take another look at them in times of economic downturn. It is possible that they may have new value in a different time or economy. Conversely, it may also be a good time to sell the assets at a reduced price, simply to earn enough money to remain afloat during a recession.

RELATED TERMS
  1. Market Value

    The price an asset would fetch in the marketplace. Market value ...
  2. Balance Sheet

    A financial statement that summarizes a company's assets, liabilities ...
  3. Liability

    A company's legal debts or obligations that arise during the ...
  4. Dangerous Asset

    An asset which, by its nature, creates a substantial risk of ...
  5. Book Value

    1. The value at which an asset is carried on a balance sheet. ...
  6. Asset

    1. A resource with economic value that an individual, corporation ...
Related Articles
  1. Investing Basics

    Reading The Balance Sheet

    Learn about the components of the statement of financial position and how they relate to each other.
  2. Personal Finance

    Breaking Down The Balance Sheet

    Knowing what the company's financial statements mean will help you to analyze your investments.
  3. Professionals

    Warning Signs Of A Company In Trouble

    Don't let your clients go down with ship! Learn how to escape sinking with these tips.
  4. Forex Education

    Using The Price-To-Book Ratio To Evaluate Companies

    The P/B ratio can be an easy way to determine a company's value, but it isn't magic!
  5. Retirement

    The Essentials Of Corporate Cash Flow

    Tune out the accounting noise and see whether a company is generating the stuff it needs to sustain itself.
  6. Economics

    What is Value Added?

    Value added is used to describe instances where a firm takes a product and adds a feature that gives customers a greater sense of value.
  7. Economics

    What is a Wholly Owned Subsidiary?

    A company whose common stock is 100% owned by another company, called the parent company.
  8. Economics

    What is the Breakeven Point?

    In general, when gains or revenue earned equals the money spent to earn the gains or revenue, you’ve hit the breakeven point.
  9. Economics

    Currency Crises In These Countries Will Shape 2015

    Ongoing financial and geopolitical issues have led several countries to the verge of a currency crisis in 2015.
  10. Investing

    What's Marginal Revenue?

    In microeconomics, marginal revenue is the additional revenue generated by increasing sales revenue by one unit. Another way of saying this is that the marginal revenue is the revenue generated ...

You May Also Like

Hot Definitions
  1. Asset Class

    A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same ...
  2. Fiat Money

    Currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat ...
  3. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  4. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  5. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  6. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
Trading Center