Confusion Regarding the Inclusion of Non-operating Assets to Enterprise Value

Question

Even though in the course video , its mentioned that Non-Operating Assets are added to the EV while arriving to the Equity Value , in the Practice Exam 1 , answer to one of the question is that its included in the Enterprise Value after being valued seperately according to market valuations.

Answer 1

Hi Dhruv,

In theory, the more precise way is to always use a market valuation. When that's not feasible, you'd use the Balance Sheet value of these non-operating assets.

Best,

Ned

Confusion Regarding the Inclusion of Non-operating Assets to Enterprise Value

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