Enter the total purchase price ($) and the fair value of net assets ($) into the Distribution Cost Calculator. The calculator will evaluate and display the Distribution Cost.
Distribution Cost Formula
The following formula is used to calculate the Distribution Cost.
DC = PP – FVA
- Where DC is the Distribution Cost ($)
- PP is the total purchase price ($)
- FVA is the fair value of net assets ($)
How to Calculate Distribution Cost?
The following example problems outline how to calculate Distribution Cost.
Example Problem #1:
- First, determine the total purchase price ($). The total purchase price ($) is given as 9000.
- Next, determine the fair value of net assets ($). The fair value of net assets ($) is provided as 2000.
- Finally, calculate the Distribution Cost using the equation above:
DC = PP – FVA
The values given above are inserted into the equation below:
DC = 9000 – 2000 = 7000 ($)
Example Problem #2:
The variables needed for this problem are provided below:
total purchase price ($) = 10000
fair value of net assets ($) = 7000
Entering these values and solving gives:
DC = 10000 – 7000 = 3000.00 ($)
