Which of the following statements is false regarding the business valuation process?

Multiple Choice

• Operating cash flow minus cash outlays to replace operating capacity represents free cash flow.

• Credit valuation involves estimating the worth of a company, one of its operating units, or its ownership shares.

• Fundamental valuation uses basic accounting measures to assess the amount, timing, and uncertainty of a firms future operating cash flows or earnings.

• Business valuation involves estimating the intrinsic value of a company or one of its operating units.