capitalization of earnings method
Definition
Valuation of a going concern business on the basis that the operations will continue to yield constant and regular earnings. These earnings (called 'normalized earnings') are multiplied by a capitalization rate (normally the reciprocal of the desired rate of return) to arrive at the value of the business.
Popular 'Accounting & Auditing' Terms
capitalization of earnings method in the news
Loading...
This content can be found on the following page:
http://www.businessdictionary.com/definition/capitalization-of-earnings-method.html
