(a) Of an assets: the value at which it is carried on company’s balance sheet.
(b) Of a stock or bond: the value of the assets available for that issue, as stated on the balance sheet, after deducting all prior liabilities. It is generally stated at so much per share or so much per $1,000 bond. The accepted practices excludes intangible assets in computing book value, which is thus the same as tangible asset value.
Liquidation value, or liquidating value, is the amount which would be available for a security if the business were wound up and the assets turned into cash. Liquidation value is usually less than book value, because allowance must be made for shrinkage in the value of the various kinds of assets if sold during a short period.
Compare: Going-concern value
The value of a company considered as an operating business, and therefore based on its earning power rather than on liquidation of its assets.
Compare: Liquidation value
The average U.S. 10-year treasury rate from January 1962 to August 2013 is 6.58%.
Data source: 10-Year Treasury Constant Maturity Rate
The long-term average of 10-year treasury rates could serve as the discount rate in stock valuation models such as Dividend Discount Model (DDM) and Discounted Free Cash Flow (DFCF).
What is net tangible assets
A company’s net tangible assets are calculated as total assets minus intangible assets and all liabilities. Since they are the capital invested by shareholders to run the business, net tangible assets are also referred to as invested capital or capital employed of a business.
Formula to calculate net tangible assets
Net tangible assets = Total assets – Intangible assets – Total liabilities
We have known that,
Tangible assets = Total assets – Intangible assets
So another way to calculate net intangible assets of a business is tangible assets less total liabilities,
Net tangible assets = Tangible assets – Total liabilities
Example of calculating net tangible assets
This is the balance sheet for Apple Inc (AAPL) of September 29, 2012. What is the net tangible assets of Apple on September 29, 2012?
Net tangible assets
= Total assets – Intangible assets – Total liabilities
= 176,064 – (1,135+ 4,224) – 57,854