In a privately owned business, neither debt nor equity is traded. In most publicly traded firms, equity
Fantastic news! We've Found the answer you've been seeking!
Question:
In a privately owned business, neither debt nor equity is traded. In most publicly traded firms, equity has a market value but a significant portion (or often all) of the debt is not publicly traded.
(a) How do you calculate market value of debt when all or even some of your firm's debt is bank debt and not publicly traded? How would you compute an updated cost of debt for an unrated company with bank debt?
(b) How do you calculate the market value of equity for a private entity?
Related Book For
Intermediate Accounting
ISBN: 978-0132162302
1st edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Posted Date: