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Define CASH FLOW. WHAT DOES IT INCLUDE?

WHEN SELLING A BUSINESS IS CASH FLOW N.O.I.(BEFORE TAXES) + OWNER'S SALARY + ADDITIONAL PERKS + INTEREST + DEPRECIATION & AMORTIZATION?

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Navigator Associates
Senior Consultant
Saint Louis County, MO

If you are looking for what you need to state when offering the business for sale, then it can be simply stated as "owner benefit". A better way to state it is net income + owner salary (+any other wages paid for non-essential work by family or whoever) + interest + depreciation + amortization + anything that is paid for by the business that is strictly of benefit to the owner. Examples are cell phone, auto (+expenses), insurance and the like. Cash flow in an accounting sense is entirely different.

Apr 30, 2009

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