Existing corporation wants to show increased value of corporation based on annual sales/income. What are ways to increase value of the corporation, by not contributing cash or property? If they step up value of company asset value based on appraisal or business valuation, do they need to recognize Gain? What are proper treatments and account names to be used on F/S?

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Corporation financial statements are meant to be historical cost basis and such increase to fair market value or whatever you wish to call it are not allowed under generally accepted accounting principles except for "internal" use purposes. Your clients proposed use does not appear to be for just internal use.

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>>value of corporation based on annual sales/income<<

If the income was retained, then you can show higher cash reserves or something, but if it's already been paid out in dividends or expenses then there's no net increase. The best you can do is make projections (a.k.a. guesses) about future income and value.

Depending on who you are trying to impress -- buyer, lender, client, divorce court? -- you would structure such projections in different ways. A sophisticated analyst is going to study your assumptions and underlying data, so the more detail you put into those, the stronger will be your position.

Market research, customer database, and biographies of key personnel are some of the most common reports to include. It's hard to understand intangibles, so it helps to focus on stuff like inventory and product details when possible. But ironically, it can sometimes be better to get MORE abstract, using anecdotes, metaphors, testimonials, and other lies. Business appraisers are very complicated professionals.

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>>wants to show increased value of corporation based on annual sales/income.... step up value of company asset value<<

My previous post skipped something that continues to bother me. You suggest the company has done well in terms of sales, yet the idea is to inflate the balance sheet.

That probably won't fool anybody. Assuming strong sales actually translated into net income, you need to identify what about those sales indicates future performance.

This is not to say your assets have not gone up in value. Good sales might make your customer list more important. Processes and workforce and even equipment can become more efficient and useful in a more productive business. It's just not very easy to support such claims.

At any rate, you need to be consistent about what you say is making the business worth more.

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