23: Residual Income Flashcards
1
Q
High persistence factors are associated with:
A
- low dividend payouts
- Historically high RI persistence in industry
- market leader
2
Q
Low persistence factors are associated with:
A
- High ROE
- Significant levels of nonrecurring items
- High accounting accruals
3
Q
Clean Surplus Relation is violated when:
A
charges bypass the Income Statement,
and are made directly to equity
