Estimated Recovery Value Calculator

Calculate Estimated Recovery Value (ERV)



Formula

The formula to calculate the Estimated Recovery Value (ERV) is:

\[ ERV = \frac{RR}{100} \times BV \]

Where:

What is ERV?

ERV, short for estimated recovery value, is a metric used to describe the total amount of value a company could extract from another asset that is undergoing a liquidation event such as a company going bankrupt. The book value is also considered the net present value of an asset and a recovery rate is a percentage of an asset that can be recovered during the liquidation event.

Example

Let's say the recovery rate (RR) is 50%, and the book value (BV) is $200,000. Using the formula:

\[ ERV = \frac{50}{100} \times 200,000 = 100,000 \]

So, the Estimated Recovery Value (ERV) is $100,000.

Extended information about "Estimated-Recovery-Value-Calculator"

Calculate Percent Recovery Formula

Definition: Percent recovery is the percentage of the original amount that is recovered after a process.

Formula: \( \text{Percent Recovery} = \left( \frac{\text{Recovered Amount}}{\text{Initial Amount}} \right) \times 100 \)

Example: \( \text{Percent Recovery} = \left( \frac{80}{100} \right) \times 100 \)

Estimated Ultimate Recovery Formula

Definition: Estimated Ultimate Recovery (EUR) is the total quantity of oil or gas that is expected to be economically recovered from a reservoir.

Formula: \( \text{EUR} = \text{Initial Reserves} + \text{Cumulative Production} \)

Example: \( \text{EUR} = 500 + 300 \)

Calculate Cost Recovery Percentage

Definition: Cost recovery percentage is the percentage of costs that are recovered from the total costs incurred.

Formula: \( \text{Cost Recovery Percentage} = \left( \frac{\text{Recovered Costs}}{\text{Total Costs}} \right) \times 100 \)

Example: \( \text{Cost Recovery Percentage} = \left( \frac{70}{100} \right) \times 100 \)

How to Calculate Recoverable Amount

Definition: The recoverable amount is the higher of an asset's fair value less costs to sell and its value in use.

Formula: \( \text{Recoverable Amount} = \max(\text{Fair Value} - \text{Costs to Sell}, \text{Value in Use}) \)

Example: \( \text{Recoverable Amount} = \max(150 - 20, 130) \)