Date of Award

1-1980

Document Type

Thesis

Degree Name

Master of Arts

Department

Business

First Advisor

Richard Rickert

Second Advisor

Lynn McCrary

Abstract

This culminating project by Joseph H. Wildt, submitted in partial fulfillment of a Master of Arts degree at Lindenwood Colleges in January 1980, provides an in-depth exploration of business valuation principles specifically in the context of corporate liquidations. The study integrates historical, theoretical, and practical knowledge acquired through academic coursework to analyze valuation methodologies and their applications.

The project begins by tracing the evolution of valuation theory from ancient philosophy to modern economic thought, emphasizing how historical, social, and economic conditions have influenced current valuation practices. It explores foundational theories such as the classical, neoclassical, and institutional schools of thought and highlights the development of the concept of "Fair Market Value."

Subsequent chapters delve into key valuation approaches—Market Data, Cost, and Income—explaining their relevance to tangible and intangible assets. Special focus is given to the treatment of intangible assets, including goodwill and going concern value, and their critical role in business appraisal. The study also addresses the legislative and regulatory framework governing valuations, including Internal Revenue Service guidelines and Treasury regulations.

The second part of the project outlines various methods of corporate liquidation, including Sections 331, 332, 333, and 334(b)(2) of the Internal Revenue Code, and examines the corresponding tax consequences. It discusses economic and organizational factors that influence liquidation decisions and presents a detailed case study to illustrate practical application of valuation in a real-world scenario.

The final section emphasizes the necessity of comprehensive business appraisals before executing mergers, acquisitions, or liquidations. The author argues that proper valuation, incorporating both economic behavior and tax implications, is essential for making sound business decisions. Overall, the project reinforces the critical role of the appraiser in navigating complex financial landscapes.

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