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Dear John,
I rather confused why calculate the Corporate value, we need to add the value of debt instead of just use the equity value and ignore the debts or even deduct the debts from the corporate value as a whole, is it conflict with Net Asset value due to Net Assets is derive after deducting the Liabilities
Much thanks for your clarification
The value to the shareholders alone is obviously just the equity.
However, the value of the business as a whole is the total assets less the current liabilities (which is equal to equity plus long-term debt) because it is them that are earning the profits for the business, regardless of how they are actually financed (whether entirely equity financed or whether financed partly by equity and partly by debt).
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