liquidation value

• Liquidation Value

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Efficient-market hypothesis - Criticism and behavioral finance

1 Since Bitcoins do not generate any actual earnings, they must

appreciate in value to ensure that people are willing to hold them. But

an endless appreciation, with no flow of earnings or liquidation value, is

precisely the kind of bubble the EMH says can’t happen.


Divestment - Motives

1 *A third motive for divesting is that a firm's break-up value is sometimes

believed to be greater than the value of the firm as a whole. In other

words, the sum of a firm's individual asset liquidation values exceeds the market value of the firm's combined assets. This encourages firms to sell off what would be worth more when

liquidated than when retained.https://store.theartofservice.com/the-liquidation-value-toolkit.html

Going concern - Accounting

1 If the accountant believes that an entity may no longer be a going concern, then this brings up the issue of whether its

assets are impaired, which may call for the write-down of their carrying amount to their liquidation value. Thus, the value of an entity that is assumed to be a going concern is higher than its breakup value,

since a going concern can potentially continue to earn profits.


Real options valuation - Options relating to project life and timing

1 *'Option to abandon': Management may have the option to cease a project during its life, and, possibly, to realise its salvage value. Here, when the present value of the

remaining cash flows falls below the liquidation value, the asset may be sold,

and this act is effectively the exercising of a put option. This option is also known as a 'Termination option'. Abandonment options

are American option|American styled.


Real estate appraisal - Types of value

1 *'Liquidation value' - may be analyzed as either a 'forced

liquidation' or an 'orderly liquidation' and is a commonly sought standard of value in bankruptcy proceedings. It assumes a seller who is compelled to sell after an exposure period which is less than the market-normal time-

frame.


Preferred stock - Other features or rights

1 * Preferred stock may or may not have a fixed liquidation value (or par

value) associated with it. This represents the amount of capital

which was contributed to the corporation when the shares were

first issued.[https://www.delawareinc.com

/101/index.cfm?pageid=10071 Harvard Business Services, Inc.]

Accessed February 23, 2007https://store.theartofservice.com/the-liquidation-value-toolkit.html

Preferred stock - Usage

1 These blank checks are often used as a takeover defense; they may be

assigned very high liquidation value (which must be Redemption value|

redeemed in the event of a change of control), or may have great super-

voting powers.


Market value - Liquidation value

1 Liquidation value is the most probable price that a specified

interest in real property is likely to bring under all of the following

conditions:


Partnership taxation (USA) - Service contributions

1 Recently the Treasury proposed a safe harbor valuation procedure whereby a service provider (a partner who

contributes services for a partnership interest) may be taxed on the valuation of the fair market value of the

liquidation value of the property received.Notice 2005-43(referring to proposed regulations 26 CFR 1.83-1)

According to this proposal a service provider will likely pay a tax on the receipt of a capital interest because it

is subject to a liquidation valuation.Notice 2005-43 Meanwhile a profits interest has no liquidation value because only capital interests have interests in the

liquidation of capital, instead, the profits interest is just the speculative value of a share in future profits.


Liquidation value

1 Liquidation value may be either the result of a forced liquidation or an orderly liquidation


Spyker Cars - History

1 On 16 April 2012, a meeting on Saab’s bankruptcy was held at the District Court of Vänersborg. The official receivers in charge of the

Saab liquidation valued the assets at us$500m and the debt at

US$2,000m. After subtracting the value of the assets, Saab leaves a

debt of US$1,500m.


Land value - Types of value

1 *'Liquidation value' – may be analyzed as either a 'forced

liquidation' or an 'orderly liquidation' and is a commonly sought standard of value in bankruptcy proceedings. It assumes a seller who is compelled to sell after an exposure period which is less than the market-normal time-

frame.


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