For cash, bank accounts, and certificates of deposit, just used their stated value. $1 = $1 in market value.
If you are trying to determine the value in the past, you can also look up the historic value for the date in question.
For treasury bills, the market value can be calculated using the stated interest rate and the number of days until maturity. For example, if you have a $100 treasury bill with 180 days to maturity that earns 1. 5%, start by multiplying the interest rate by the days to maturity to get 2. 7 (0. 015*180). Divide this number by 360 (an approximation of the number of days in the year) to get 0. 0075. Then, subtract this number from 1 to get 0. 9925. Finally, multiply that by the bond’s face value, $100, to get $99. 25, the market value of the bond. [3] X Research source
For more information, see how to determine net accounts receivable
Additionally, seek expertise of a local real estate broker who has comps (detailed descriptions of comparable properties) on recently sold properties. Use such resources to determine the narrow range within which buyer and seller will agree. The market value of this asset will be the price buyers are willing to pay in this market (that is, this geographical area, this price range, this product detail).
Goodwill, which refers to the value of your business’s name: your standing and reputation within the community, a loyal customer base, good employee and customer relations, etc. [9] X Research source Trademarks, which identify a product or service as property of your specific company. [10] X Research source A trademark cannot be used without your permission, but may be sold or temporarily licensed to other companies. An example of a trademarked asset would be an original logo, such as the Starbucks mermaid or Nike swoosh. [11] X Research source Copyrights, which protect intellectual property, such as software, art, films, original concepts, etc. [12] X Research source Copyrights are in effect only for a certain number of years before the property becomes public domain and can be used by anyone. [13] X Research source Brand recognition, which considers the extent to which the general public can identify your company or product based on your logo, colors, slogans, or other marketing tools. [14] X Research source McDonalds, for instance, can easily be identified by the “golden arches” symbol and by its slogan “I’m lovin’ it. " Brand recognition also presents the opportunity for a franchise. Patents, which give patent holders the sole rights to sell, use, or manufacture an invention (as granted by the government). Other examples include location, current workforce skill, and contracts or agreements with other companies, which can all add value to your company.
Capitalization of historic profits. This method multiplies the estimated historic profitability of the intangible by a multiple. The multiple is also estimated using data like sales trends, market leadership, and brand recognition data. This method is very subjective and relies on many assumptions. Gross profit differential. This method compares the profitability of the company with the intangible asset (for example a brand name) against that of a company in the same industry without the same intangible and seeks to identify the difference in profits accounted for by the intangible.
The type of valuation you have done will depend on the purpose of the valuation. For example, if you want to sell a company you own, you will likely want it valued as highly as possible. If you are valuing assets for estate tax purposes, you likely want them valued as low as possible. The valuation process can be very subjective so it’s best to use a valuation professional who specializes in the type of valuation you need. Generally, a CPA (Certified Public Accountant) with an ABV (Accredited in Business Valuation) designation can provide a valuation.
