Net Worth & capital Employed

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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)
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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.

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