Hi, Regarding the Excess Earnings Method I understand how we find the return on intangible Assets and how to capitalize it to find todays value of intangible assets.

Then when valuing the firm most examples use this formula: Vo = Fixed Assets(given) + Working Capital(given) + Value of intangible Assets(calculated as mentioned above). However it says nothing about debt or liabilities, neither in the question or in the answer. If we were given information about that, how would that be included to the formula above, i.e. the formula we use when we find the value of the firm. I would guess that we add the MV of the debt to the value of the firm. Is that correct and is there anything to be aware of? e.g. any part of the debt that are not included etc. Thanks for the help.