Despite the clear cons of book value plus equity method of firm evaluation,we often see it used as a starting point for valuation.

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Quizplus · Accepted Answer

Even though there are disadvantages of using book value plus equity method for firm evaluation, it is still commonly used as a preliminary step in valuation. This is because it provides a simple and straightforward method of assessing the financial position of a company, which can be useful in setting a baseline for more in-depth analysis. However, it is important to recognize the limitations of this approach and to use additional valuation methods to provide a more complete picture of a company's value.

Despite the Clear Cons of Book Value Plus Equity Method