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More on the Discounting of Residual Income Streams
Author(s) -
STARK A. W.
Publication year - 1986
Publication title -
abacus
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.632
H-Index - 45
eISSN - 1467-6281
pISSN - 0001-3072
DOI - 10.1111/j.1467-6281.1986.tb00121.x
Subject(s) - residual , passive income , cash flow , discounting , streams , economics , discounted cash flow , investment (military) , econometrics , actuarial science , public economics , accounting , mathematics , gross income , finance , computer science , computer network , algorithm , politics , political science , tax reform , law , state income tax
The purpose of this paper is to take the conclusions reached by Peasnell (1981, 1982) and Kay (1976) and show that the use of discounted residual incomes for project evaluation purposes requires the prior appraisal on a cash flow basis. The use of residual income at the investment planning and subsequently at the accounting stages is also evaluated.