Earnings |
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Earnings |
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The third step in the evaluation process is to complete the Earnings worksheet. You use the worksheet to estimate the actual cash cost of operating the business by removing non-productive expenses and adding back all non-cash expenses.
Note: |
The Discretionary Income amount calculated on the Earnings worksheet is applied to all of the evaluation methods that use earnings as a criterion. Be extremely accurate! |
The form of the Earnings worksheet is determined by your response to the first question on the Questionnaire, which asks if you want to normalize earnings:
„If you answered Yes, see Calculating Normalized Earnings.
„If you answered No, see Calculating Current Discretionary Income.