Question #23
Reading: Reading 22 Market-Based Valuation - Price and Enterprise Value Multiples
PDF File: Reading 22 Market-Based Valuation - Price and Enterprise Value Multiples.pdf
Page: 8
Status: Correct
Correct Answer: B
Question
Underlying earnings may be defined as earnings:
Answer Choices:
A. net of capital expenditures needed to keep the business productive
B. that include non-recurring components
C. that exclude non-recurring components
Explanation
Underlying earnings are earnings that exclude non-recurring items. They are also known
as persistent, continuing, or core earnings.