Dr. B recently graduated from dental school. He is preparing to go to the bank to borrow funds needed to open a new office and start his practice. He prepared a financial statement showing a negative net worth, but no one could expect him to have accumulated a positive net worth while going to dental school. The community in which he planned to start his practice was his home town. He expected the bank to be enthusiastic about loaning him the money needed to establish a long-term business relat
The following scenario is a sales pitch made by a dental equipment salesman to convince a young dentist to start-up a new practice from scratch, which is equivalent to buying a practice for $500,000 that has no patients:
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The lower the current AAPPP is for a general dental practice, the better the potential growth exists for this practice...
The most widely used method for determining practice value is fair market value. The commonly accepted definition of fair market value is the price which a professional practice would produce, allowing reasonable time to find a purchaser, with both buyer and seller having access to full disclosure of information about each other.
Office rent should be in the area of 4% of gross practice gross revenues...
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