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Cost approach method

DELIS T. CARVAJAL MOLINA

Created on October 17, 2022

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Transcript

Cost approach method

Stage 3 Identify technology value

presented by: Delis Tatiana Carvajal group: 212032_28 16-10-2022

• Definition Cost approach method

It is a real estate appraisal method that estimates the price to be paid by the buyer regarding a product or service.

• Related processes and mathematical formulas for calculating the value of technology using the Cost approach method:

There are two main types of cost-based appraisals: Reproduction Method: This version considers what it would cost to build a replica of the property and pays attention to the use of original materials. replacement method. In this case, the new structure is assumed to have the same function but with newer materials, using current construction methods, and an updated design. cost approach to valuing trade secret -current person-month times total absorption cost = estimate of a new replacement cost estimate total cost of absorption related to the employees who develop the commercial secret -current cost per person-hour for all the hours of the company's employees actually dedicated to the development, testing and implementation of the trade secret. When all estimates have been collected, the cost approach is calculated as follows: -cost – depreciation + land value = property value.

• How can companies create value from their

innovation?: companies can create value from their innovations, bringing to the market a new product with characteristics similar to their products but that this leads to an improved process and that is by a new method of organization in practice or development of products or services.

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Bibliographic References

https://www-investopedia-com.translate.goog/terms/c/cost-approach.asp?_x_tr_sl=en&_x_tr_tl=es&_x_tr_hl=es&_x_tr_pto=sc

REILLY, R. F. (2015). Family Law Valuation of Technology Intangible Assets. American Journal of Family Law, 29(1), 16–26. https://bibliotecavirtual.unad.edu.co/login?url=https://search.ebscohost.com/login.aspx?direct=true&db=lgs&AN=101056263&lang=es&site=eds-live&scope=site