Income measurement Concepts Permanent incomes Equals stable average income that a company is expected to earn over its life Reflects a long-term focus Directly proportional to company value Often expressed by dividing permanent income by cost of capital Also called sustainable earning power, or sustainable or normalized earningsPermanent Income* • Equals stable average income that a company is expected to earn over its life • Reflects a long-term focus • Directly proportional to company value • Often expressed by dividing permanent income by cost of capital *Also called sustainable earning power, or sustainable or normalized earnings Income Measurement Concepts