What does Capital Employed mean?

Capital Employed meaning in Finance Dictionary

the worthiness of the many assets employed in a business, including equity and choice share capital, fixed and present possessions, and gross borrowings plus present assets and less present debts. The most common usage of money utilized is in the calculation of 'Return on ' which measures the running revenue of a business as a percentage of capital employed. Ultimately, ROCE is suggesting just how efficient an organization are at squeezing revenue out of money. A company that gets 20m of revenue out of 200m capital employed is performing superior to one that gets 20m of profit off 800m of money employed.

Capital Employed meaning in Law Dictionary

In general, it represents the administrative centre financial investment essential for a business to function. Consequently, it is not a measure of assets, but of money financial investment: stock or shares and long-term debts.

Capital Employed meaning in Business Dictionary

complete capital utilized in a company's fixed and existing assets. Viewed through the financing part, it equals stockholders' resources (equity money) plus long-lasting liabilities (loan money). Viewed from the asset side, it equals fixed possessions plus working possessions.

Sentence Examples with the word Capital Employed

During the first two years the bank remitted the greater part of its capital to Persia at the then prevailing exchange, and received for every pound sterling 32 t0 34 krans; but in consequence of the great fall in silver in I893 and 1894, the exchange rose to 50 krans per pound sterling and more, and the banks capital employed in Persia being reduced in value by more than one-thirdIO0 krans, which at the beginning represented 3 then being worth only 2 or lessthe original capital of one million sterling was reduced to 650,000 in December 1894.

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