EXCESS EARNINGS METHOD Definition

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EXCESS EARNINGS METHOD is a specific way of determining a value indication of a business, business ownership interest, or security determined as the sum of a) the value of the assets obtained by capitalizing excess earnings and b) the value of the selected asset base. Also frequently used to value intangible assets.

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RESIDUAL CLAIM is a claim to a share of earnings after debt obligations have been satisfied.

SS see SAFETY STOCK.

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