Intermediate Accounting When Conducting Business Essay

Open, View, and/or
Download this Document

Total Length: 1746 words ( 6 double-spaced pages)

Total Sources: 1+

Page 1 of 6



Earning Growth Model

This third method considers primarily the increase in organizational earnings and the decision to purchase a stock is pegged to increases in organizational incomes. Valuation through this method is generally less challenging than the previous two models and often extremely practical.

It commences with the estimations of future earnings, based on relevant and viable information about the expected trend in the future of the assessed company -- the growth rates can be either constant either variable, and this does not impact the valuation method nor the outcomes, as long as they are reliable. The most useful and relevant means of setting the growth estimations is given by the usage of past growth rates and trends.

Stuck Writing Your "Intermediate Accounting When Conducting Business" Essay?

View All Our Example Intermediate Accounting When Conducting Business Essay

Have A Custom Example Essay Written

Finally, the future earnings are discounted with the expected return on investment (ROI). The relevance and utility of this model is given by the fact that it reveals the price of the stock in direct relationship with the projected earnings (Anuar).

Based on the presentation of these three valuation methods, one can come to the conclusion that the easiest to implement and the one which reveals the most utility and should be implemented by the contemporaneous manager is the earning growth model......

Show More ⇣

     Open the full completed essay and source list


OR

     Order a one-of-a-kind custom essay on this topic


sample essay writing service

Cite This Resource:

Latest APA Format (6th edition)

Copy Reference
"Intermediate Accounting When Conducting Business" (2009, August 25) Retrieved July 8, 2025, from
https://www.aceyourpaper.com/essays/intermediate-accounting-conducting-business-19790

Latest MLA Format (8th edition)

Copy Reference
"Intermediate Accounting When Conducting Business" 25 August 2009. Web.8 July. 2025. <
https://www.aceyourpaper.com/essays/intermediate-accounting-conducting-business-19790>

Latest Chicago Format (16th edition)

Copy Reference
"Intermediate Accounting When Conducting Business", 25 August 2009, Accessed.8 July. 2025,
https://www.aceyourpaper.com/essays/intermediate-accounting-conducting-business-19790
   

Open, View, and/or
Download this Document
order custom essay example