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Gross Equity Income

The amount of unconsolidated earnings from the cash flow, principal reduction, and first year appreciation of a specified asset. Gross Equity Income is the total value of all income, dividends, and rents derived from an asset (including cash) over a stated time period as well as the value of capital investments and contributions made by an investor before liabilities and depreciation have been calculated. Gross Equity Income does not take into account future appreciation as it is intended to show the value of money (and present day value) of an investment on hand today. Before all expenses are deducted, the gross amount should be an accurate assessment of an individual’s liquidity. The deduction of liabilities, such as mortgage balance owed, is essential in calculating the true Gross Equity Income figure. Regulatory assessments such as taxes, tariffs and other levies also do not contribute to the equation for the calculation of the Gross Equity Income figure. The type of asset that the Gross Equity Income figure applies to is irrelevant. The equation can apply to stocks, cash, real estate and other tangible / intangible property. If the asset has a value and can generate income or dividends, then it can be part of the equation.

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