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Reproduction Value Method

This document outlines the reproduction value method for estimating the equity value of an asset. It involves conducting an analysis to determine the cost of reproducing all assets, adjusting book values to reflect reproduction costs, and then applying a formula using the adjusted figures to calculate equity value based on reproduction costs.

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Jehannah Micah Aquino
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196 views

Reproduction Value Method

This document outlines the reproduction value method for estimating the equity value of an asset. It involves conducting an analysis to determine the cost of reproducing all assets, adjusting book values to reflect reproduction costs, and then applying a formula using the adjusted figures to calculate equity value based on reproduction costs.

Uploaded by

Jehannah Micah Aquino
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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1.

Reproduction value method - is an estimate of cost of reproducing, creating,


developing or manufacturing a similar asset.

Steps in determining the equity value using the RVM:


1. Conduct reproduction cost analysis on all assets
2. Adjust the book values to reproduction cost values (similar as replacement value)
3. Apply the replacement value formula using the figures calculated in the
preceding step.

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