Income Approach

A general way of determining a value indication of a business’s assets and/or equity using one or more methods wherein a value is determined by converting anticipated benefits.

The various methods of valuation that appraisers use in practice are typically considered as methods within these broad approaches. Valuation methods under the Income approach generally contain common characteristics such as measures of benefit streams, discount rates, and/or capitalization rates and multiples.

(International Glossary of Business Valuation Terms)