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NJ business valuations accountant Robert A. Bonavito, CPA, talks about the intrinsic valuation method that is used to value a company. New Jersey accounting professionals go to court often for this. Robert explains the best method for valuing a company. Valuing the cash flow is the best way to determine the value of a business.
If a company has a $100 in cash flow, then the intrinsic value would be at $100. The intrinsic value method has been around forever, even going back so far as to Ancient Egyptian times.
The process of determining intrinsic value comes down to two methods. The first method is the discounted cash flow, which is when you make a projection of cash flow into the future and discount it back. The second method is the capitalization rate, which is when you take the average cash flow and divide it by the capitalization rate. 90% of companies use the intrinsic value method to determine the value of their business.
Robert A. Bonavito is an accountant and consultant specializing in litigation support services and providing accounting and tax advice to high-net-worth individuals, their families, and businesses. For more information, visit: http://www.rabcpafirm.com/practices/business-valuations/?utm_source=youtube.com&utm_content=K0MOTPTPv9E.
Robert A. Bonavito, CPA
http://www.rabcpafirm.com/?utm_source=youtube.com&utm_content=K0MOTPTPv9E
1812 Front Street
Scotch Plains, NJ 07076
Telephone: (908) 322-7719
Fax: (908) 322-7792
The post NJ Business Valuations Accountant Explains Intrinsic Valuation Method appeared first on HumanitasConnects.
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