There is no precise formula for pricing a business. There are several ways that can be used to arrive at a sale price. In the most common method, some variation based on current earnings of your business that are then capitalized or multiplied times a rate typical for your type of business or the market in general is used. If you earned $50,000 last year and the capitalization rate for your industry is 10, then your business will be valued somewhere around $500,000. Of course, various elements of the sale, such as the inclusion of intellectual property, assets, etc., may cause that to vary. The bottom line, though, is your business is worth what someone is willing and able to pay for it. There are many good references that provide considerably more detail about the various models for valuing a business. One, at Entrepreneur.com, is titled What's Your Company Worth?