Modified Book Value

AAA

DEFINITION of 'Modified Book Value'

An asset-based method of determining how much a business is worth by adjusting the value of its assets and liabilities according to their fair market value. This technique also includes the value of all of the business's intangible assets and liabilities, such as goodwill and pending litigation.

INVESTOPEDIA EXPLAINS 'Modified Book Value'

Liquidation value and replacement value are two other asset-based valuation methods. Businesses are also commonly valued using market multiple methods, capitalization rates, excess earnings or discounted cash flow. Companies that specialize in business valuation can be hired to determine a business's value for a number of purposes, including a merger or acquisition, shareholder transaction, estate planning and financial reporting.

VIDEO

RELATED TERMS
  1. Business Valuation

    The process of determining the economic value of a business or ...
  2. Fair Market Value

    The price that a given property or asset would fetch in the marketplace, ...
  3. Asset

    1. A resource with economic value that an individual, corporation ...
  4. Asset Valuation

    A method of assessing the worth of a company, real property, ...
  5. Intangible Asset

    An asset that is not physical in nature. Corporate intellectual ...
  6. Liability

    A company's legal debts or obligations that arise during the ...
Related Articles
  1. Using The Price-To-Book Ratio To Evaluate ...
    Forex Education

    Using The Price-To-Book Ratio To Evaluate ...

  2. Can You Count On Goodwill?
    Personal Finance

    Can You Count On Goodwill?

  3. Intangible Assets Provide Real Value ...
    Markets

    Intangible Assets Provide Real Value ...

  4. How do you calculate retained earnings ...
    Fundamental Analysis

    How do you calculate retained earnings ...

Hot Definitions
  1. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  2. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  3. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  4. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  5. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  6. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
Trading Center