What is the valuation of machinery and equipment – accumulation method

They start from a risk-free rate and add additional risk factors, management burdens, and illiquidity to obtain an appropriate rate of return.

Weighted Average Return on Assets (WARA) method:

This method is based on the assumption that the entity has a financial portfolio of tangible financial and physical assets. The fair value of long-term debt in addition to the fair value of equity is equal to the sum of the fair values of net working capital.

For fixed tangible assets, the weighted average return on assets is the rate of return for each category weighted according to its fair value

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