Lesson: Net Book Value Calculation

In this lesson, Nick Palazzolo, CPA, unpacks the mechanics behind calculating net book value, also known as carrying value, of assets on a balance sheet. He breaks down the process into understandable terms, explaining how to determine carrying amounts by considering the original cost of an asset and subtracting any accumulated depreciation, provision for doubtful debts, and impairment losses. Nick further clarifies the revaluation model, where fixed assets are routinely adjusted to reflect fair market value, ensuring that their recorded net book value remains aligned with current valuations. Dive deep into the nuances of asset valuation as Nick illustrates the impact of these adjustments on financial statements.