PrivCo Inc. is a small private firm with a book value of assets of $550,000 and liabilities
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PrivCo Inc. is a small private firm with a book value of assets of $550,000 and liabilities of $250,000. Its assets include property listed at a cost of $80,000 but with a recently assessed market value of $125,000. In addition, PrivCo has $60,000 of inventory that is entirely obsolete and has no liquidation value. Other assets are deemed to have liquidation values close to book values. Estimate the value of PrivCo's equity based on the "book value of equity plus adjustments" method.
LiquidationLiquidation in finance and economics is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they are due....
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Book value of assets 550000 Less book value of liabiliti...View the full answer
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Related Book For 
Financial Management Concepts and Applications
ISBN: 978-0132936644
1st edition
Authors: Stephen Foerster
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