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Liquidation and Recoverable Values

Asset-valuation terms for liquidation value, recoverable amount, residual value, salvage value, and disposition differences.

Liquidation and Recoverable Values covers asset-valuation terms for liquidation value, recoverable amount, residual value, salvage value, and disposition differences.

Use these pages when balance-sheet measures change asset value, downside protection, recoverability, or valuation comparability. It sits inside Liquidation, Residual, Recoverable, and Depreciated Values, so readers can move up when the broader valuation context matters.

Use the table below to choose the narrower valuation branch before relying on a model input, market multiple, forecast, risk premium, price signal, or recommendation.

What This Branch Covers

AreaUse it for
Liquidation ValueLiquidation value estimates what assets may realize if sold to repay creditors or wind down a business.
Liquidation vs. DispositionLiquidation and disposition both involve asset exits, but liquidation focuses on cash recovery while disposition can include transfer, sale, or retirement.
Recoverable AmountRecoverable amount is the higher of an asset’s fair value less costs of disposal and its value in use.
Residual ValueEstimated value remaining for an asset at the end of its useful life, lease term, or investment horizon.
Salvage ValueSalvage value is the estimated residual amount an asset may be worth at the end of its useful life.

What to Check

  • Forecast source, valuation date, market data, accounting adjustments, and model version.
  • Cash-flow input, discount rate, multiple, growth assumption, terminal value, balance-sheet adjustment, and scenario range.
  • Comparable set, transaction set, sector, geography, size, leverage, margin profile, and accounting basis.
  • Effect on intrinsic value, relative value, price target, margin of safety, impairment view, deal price, or recommendation.
  • Sensitivity to growth, margins, reinvestment, discount rate, exit multiple, leverage, and market conditions.

Common Mistakes

  • Treating a valuation output as a precise fact instead of a range of estimates.
  • Comparing multiples without normalizing earnings, leverage, accounting policy, growth, and risk.
  • Ignoring valuation date, source quality, cyclicality, nonrecurring items, and sensitivity analysis.
  • Using valuation terminology as personalized investment, tax, legal, or appraisal advice.

Valuation content is educational and does not provide investment, tax, legal, accounting, appraisal, or valuation advice.

In this section

Choose a subsection first. Deeper term pages live inside each subsection, which keeps large topic hubs readable.

Liquidation Value

Liquidation value estimates what assets may realize if sold to repay creditors or wind down a business.

Liquidation vs. Disposition

Liquidation and disposition both involve asset exits, but liquidation focuses on cash recovery while disposition can include transfer, sale, or retirement.

Recoverable Amount

Recoverable amount is the higher of an asset's fair value less costs of disposal and its value in use.

Residual Value

Estimated value remaining for an asset at the end of its useful life, lease term, or investment horizon.

Salvage Value

Salvage value is the estimated residual amount an asset may be worth at the end of its useful life.

Revised on Sunday, June 21, 2026
Depreciated Value