The Formula for Calculating Human Capital Value Added = Revenue

question 44

True/False

The formula for calculating human capital value added = Revenue - (Operating Expense - (Compensation + Benefit Costs)) / Full-Time Head Count

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Definitions:

Owner's Capital

Represents the total equity of the owner in a business, which consists of the initial and additional investments minus any withdrawals.

18-Month Insurance

This term refers to a prepaid insurance policy that covers a period of 18 months, recognized as an asset initially and expensed over the duration of the coverage.

Weekly Payroll

The total sum of all employee earnings paid on a weekly basis.

Supplies on Account

Supplies purchased by a company on credit, for which payment will be made at a later date, increasing accounts payable.