What Is an Adjusted Book Value?
The net asset book value adjustment method is a method to determine the company's value after making necessary adjustments based on the book company's net asset book value.
Book value adjustment method of net assets
Right!
- The net asset book value adjustment method is a method to determine the company's value after making necessary adjustments based on the book company's net asset book value.
- Calculation
- Its calculation formula is:
- Target company's value = Target company's net asset book value × (1 ± adjustment factor) × Proposed acquisition of shares in the target company's total shares
- For example, in the merger and acquisition activities of Company A, the net book value of Company B at the time of the merger was 80 million yuan. Taking into account factors such as the appreciation of assets, the adjustment factor was + 25%. Company A acquired all the shares of Company B. , Then calculate the value of Company B as follows:
- Company B's value = 80 million yuan × (1 + 25%) = 1 (100 million yuan)