Ten years ago Tom Civil purchased a former corner store property, for the price of $80,000, located in the small town of Kinkville, Nova Scotia, and renovated the old building on the property and started a coffee shop (a sole proprietorship operating under the business name “Civilized Coffee Services” or “CCS”). There are two other coffee shops in town, but Tom’s business does well (over the years he becomes friends and acquaintances with most of the local Kinkville “mucky-mucks”) and in the past five (5) years his business has an EBITDA (i.e. earnings before interest, taxes, depreciation and amortization) of the following: 2016 $32,000 2015 $23,000 2014 $19,000 2013 $15,000 2012 $26,000 The assets of the business consist of the above mentioned land, building, inventory and equipment, which have the following book and market values: Table 1 Asset Book Value Market Value Land 20000 20000 building 42000 90000 inventory 2000 2500 equipment 4000 4500 The most recent financial statements of CCS, as of February 2017, show owner’s equity of $42,000. Tom offers to sell the business as a going concern, including the land other assets, to his close friend Laura Rose for $150,000, and Laura comes to you, a certified business valuator, for your opinion on this price. What do you think? Write an opinion letter to Laura. Justify your answer. Requirement: Double space, minimum 3 pages (use the knowledge of PPT i provided ------business valuation as a going concern type ) .

1. Ten years ago Tom Civil purchased a former corner store
property, for the price of $80,000, located in the small town of
Kinkville, Nova Scotia, and renovated the old building on the
property and started a coffee shop (a sole proprietorship
operating under the business name “Civilized Coffee Services”
or “CCS”). There are two other coffee shops in town, but Tom’s
business does well (over the years he becomes friends and
acquaintances with most of the local Kinkville “mucky-mucks”)
and in the past five (5) years his business has an EBITDA (i.e.
earnings before interest, taxes, depreciation and amortization)
of the following:
2016 $32,000
2015 $23,000
2014 $19,000
2013 $15,000
2012 $26,000
The assets of the business consist of the above mentioned land,
building, inventory and equipment, which have the following
book and market values:
Table 1
Asset
Book Value
Market Value
Land
20000
20000
building
42000
90000
inventory
2000
2500

2. equipment
4000
4500
The most recent financial statements of CCS, as of February
2017, show owner’s equity of $42,000.
Tom offers to sell the business as a going concern, including the
land other assets, to his close friend Laura Rose for $150,000,
and Laura comes to you, a certified business valuator, for your
opinion on this price. What do you think? Write an opinion
letter to Laura. Justify your answer.
Requirement: Double space, minimum 3 pages (use the
knowledge of PPT i provided ------business valuation as a going
concern type )