BizSugar.com › Finance › Quality of Earnings Part 1: Revenue Traps

While a formal, third-party Quality of Earnings Study is more often seen in mid-market transactions, even small business owners should be aware of the factors that can cause discounts to a selling price long after they thought it was settled. There are few things as exciting as receiving a Letter of Intent to purchase your company. The exact profit, or earnings, that will be multiplied to calculate the price may seem obvious to you, but you shouldn’t be too sure.