{"ok":true,"canonical_url":"https://dealroom.so/glossary/cost-or-market-value","api_url":"https://dealroom.so/api/public/glossary/cost-or-market-value","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"cost-or-market-value","term":"Cost or Market Value","group":"Reading the business","definition":"An accounting principle requiring inventory to be valued at the lower of its original cost or its current market value. This prevents overstating asset values if market prices drop.","what_it_means":"When assessing a business's Balance Sheet, pay attention to how inventory is valued. If market conditions have changed, the stated inventory value might be higher than what you could actually sell it for. This impacts the true value of the assets you're acquiring and can affect collateral analysis.","url":"https://dealroom.so/glossary/cost-or-market-value","official_sources":[],"related":[{"slug":"balance-sheet","term":"Balance Sheet","url":"https://dealroom.so/glossary/balance-sheet"},{"slug":"inventory","term":"Inventory","url":"https://dealroom.so/glossary/inventory"},{"slug":"business-valuation","term":"Business valuation","url":"https://dealroom.so/glossary/business-valuation"},{"slug":"fair-market-value","term":"Fair market value","url":"https://dealroom.so/glossary/fair-market-value"}],"related_questions":[{"question":"How does a lender determine the fair market value of business equipment used as collateral?","url":"https://dealroom.so/sba-7a/questions/how-does-a-lender-determine-the-fair-market-value-of-business-equipment-used-as-collateral"},{"question":"How does the SBA verify the fair market value of assets contributed as equity injection?","url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-verify-the-fair-market-value-of-assets-contributed-as-equity-injection"},{"question":"How does a lender evaluate the market value of collateral when there are limited comparable sales?","url":"https://dealroom.so/sba-7a/questions/how-does-a-lender-evaluate-the-market-value-of-collateral-when-there-are-limited-comparabl"},{"question":"If a borrower contributes equipment as equity, how does the lender verify its fair market value?","url":"https://dealroom.so/for-lenders/questions/if-a-borrower-contributes-equipment-as-equity-how-does-the-lender-verify-its-fair-market-v"},{"question":"How does the SBA evaluate the fair market value of goodwill in a business acquisition for financing?","url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-evaluate-the-fair-market-value-of-goodwill-in-a-business-acquisition-for-"},{"question":"Can the fair market value of raw materials I contribute to the acquired business count towards equity?","url":"https://dealroom.so/sba-7a/questions/can-the-fair-market-value-of-raw-materials-i-contribute-to-the-acquired-business-count-tow"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Cost or Market Value","url":"https://dealroom.so/glossary/cost-or-market-value","source_type":"DealRoom Data"}}