📒 Residual Income Calculator
Economic profit after equity charge
How to Use This Calculator
1
Enter net income
Use annual net income.
2
Enter equity and Re
Provide equity and cost of equity (%).
3
Calculate
Positive residual implies value creation.
Formula
Residual Income = Net Income − Equity × Re
Frequently Asked Questions
Is this the same as EVA?
Similar concept; EVA uses invested capital and WACC versus equity and Re.
What Re should I use?
Use your estimated cost of equity (e.g., from CAPM).