EARNING CAPACITY Definition

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EARNING CAPACITY is the net average earnings at a given moment in time: past, current or future.

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ROA see RETURN ON ASSETS.

OPEN ITEM is a contractual or scheduled commitment that is not yet reflected in Financial Accounting but will lead to actual expenditures in the future, e.g. a purchase order that is not shipped in full will list those unshipped items as open items within the shipping invoice.

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