residual income

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May 29, 2020 at 8:08 am #572173
AverageAndy
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sir i dont understand this definition of residual income mentioned in my study text:

“RI is the net operating income that an investment centre or division earns above the minimum required return on its operating assets”
May 29, 2020 at 9:16 am #572179
John Moffat
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It is the profit less (the required return multiplied by the net assets).

I explain this in full, with an example, in my free lectures.

The lectures are a complete free course for Paper MA and cover everything needed to be able to pass the exam well.
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