Residual Income (RI) Calculator

Residual income calculator for businesses, calculating equity charge and residual income based on equity capital, cost of equity, and net income.

Result Equity Charge $0 Residual Income $0

Related Calculators: Annualized Return Calculator, Appreciation Calculator, Asset Allocation Calculator: Find the Perfect Balance of Risk and Reward, Capital Asset Pricing Model (CAPM) Calculator, Cost of Equity Calculator, Compound Interest Calculator, Compound Annual Growth Rate (CAGR) Calculator, Economic Value Added (EVA) Calculator, Equivalent Rate (ER) Calculator, Expected Return Calculator,

Equity Charge Formula

Equity charge = Equity capital * ( Cost of equity / 100 )

$5600 * (23% / 100) = $1288.0 This result represents the equity charge calculated using the given formula, which assumes a cost of equity of 23% and an equity capital of $5600.

Residual Income Formula

Residual income = Net income - Equity charge

$16600 - $14600 = $2000 Residual income is the profit left after covering the equity charge of $2000 from net income of $16600.

Meaning

Residual Income (RI) is the amount of money earned from investments or other income sources after deducting all expenses and financial obligations.