The aim of this article is to give a clear understanding of discounted cash flow valuation. The paper will explain what a discounted cash flow valuation is and its importance in financial business decisions regarding investment strategies. This paper will give a detailed discussion on discounted valuations for present and future multiple cash flows with respect to even and unequal schedules using clear step-by-step examples. Some advantages and disadvantages of using the discounted cash flow valuation method for businesses will also be included. Finally, the document will summarize the important highlights covered in the body of the document. Valuing Discounted Cash Flows Today, financial business leaders continually ask themselves, “What will investing today look like for the future health of the business?” Should financial decisions be suspended until markets strengthen? Is it more profitable to act now to better position the company's market share? So many questions that could be answered clearly if managers had a magical financial crystal ball. Instead of a crystal ball, managers have a way to calculate financial risks with some certainty to better predict positive outcomes from financial investments through discounted cash flow (DCF) valuation. DCF valuation is a realistic approach, a tool used to "determine the future and current value of investments with multiple cash flows" over a particular period of time that is incurred at the end of each period (Ross, Westerfield and Jordan , 2011). ). Solutions Matrix defines DCF as a “cash flow summary adjusted to reflect the time value of money (The Meaning of Discounted Cash Flow, 2014).” The valuation of money paid or received...... middle of paper ...... flow valuation has been correctly calculated to show that projected future cash inflows will be greater than the current value of the assets of the company. Works cited (2013). Retrieved January 20, 2014 from Wall Street Oasis: http://www.wallstreetoasis.com/finance-dictionary/what-is-a-discount-rate (January 18, 2014). Retrieved January 19, 2014, from Business Case Analysis: http://www.business-case-analysis.com/discounted-cash-flow.htmlGarger, J. (October 17, 2010). (L. Patsalides, ed.) Retrieved January 20, 2014 from Bright Hub: http://www.brighthub.com/money/personal-finance/articles/18345.aspxMacabacus. (2014). Retrieved January 20, 2014 from http://macabacus.com/valuation/dcf/overviewRoss, SA, Westerfield, RW and Jordan, BD (2011). Essentials of Corporate Finance (7th ed.). New York, New York, USA: McGraw-Hill/Irwin. Retrieved January 19, 2014