Save Rs 588 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

Net Worth & capital Employed

Save Share

Join Us Follow Us Add as Source

This query is : Resolved

Report Follow Query Ask a Query

Querist : Anonymous

Querist : Anonymous (Querist)

09 June 2010 Is there any diffenance in Net worth & Capital employed? also tell me meaning of these two terms?

CA Punit

CA Punit (Expert)
Follow

09 June 2010 Net worth is
Total Assets - Total Liabilities
i.e. Owners' Funds including Retained Earnings.
Net worth is an important determinant of the value of a company, considering it is composed primarily of all the money that has been invested since its inception, as well as the retained earnings for the duration of its operation.

Capital Employed is
Fixed Assets + Current Assets - Current Liabilities
i.e. Owners' Funds + Borrowed Long Term Funds
Capital employed is the value of the assets that contribute to a company's ability to generate revenue.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now