Economic Analysis: Theory and Practice

Problematic aspects of calculating the capital turnover indicators

Vol. 17, Iss. 5, MAY 2018

Received: 13 February 2018

Received in revised form: 28 February 2018

Accepted: 12 March 2018

Available online: 29 May 2018

Subject Heading: SCHOLAR DISPUTE

JEL Classification: O12, Q01

Pages: 981-996

Savitskaya G.V. Belarus State Economic University, Minsk, Republic of Belarus

ORCID id: not available

Importance Indicators of capital turnover characterize business activity of a business entity from a financial perspective. Regular monitoring of the rate of capital turnover is of great importance to ensure an effective mechanism of capital management. However, there are a lot of discrepancies in the methodology for capital turnover calculation in the scientific and educational literature, and many indicators have appeared that have no economic rationale and practical significance.
Objectives The study aims to investigate problematic aspects of identification and assessment of the rate of capital turnover and justify my own position on the issues.
Methods Works by domestic and foreign economists on finance and capital management create a theoretical and methodological basis of the research. I apply the historical approach alongside with general and special methods of analysis, synthesis and analogies.
Results The paper provides a more exact definition of the framework of categories and concepts, the economic substance of capital turnover indicators, and methods for their calculation.
Conclusions The proposed approach will serve as a basis for further development of the methodology for analyzing the economic efficiency of business, and as a methodological guidance for business entities' practical management when exercising control and making business decisions in the process of working capital management.

Keywords: capital turnover, indicator, calculation algorithm


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