What Is Exercise Value?

The value movement (Fund Movement), also known as the capital movement, is the economic activity of enterprises in terms of currency.

Value movement

The value movement (Fund Movement), also known as the fund movement,

Theoretically, the fund movement refers to the circulation and turnover of fund raising, use, consumption, recovery and distribution. The starting point of the funding campaign is the source of funding and the ending point is

The relatively static state of capital movement refers to the specific situation of the source of funds and the use of funds by the enterprise as a whole at a certain point in time. On the balance sheet, the source of funds is expressed in terms of liabilities and owner's equity, such as current liabilities, long-term liabilities, invested capital, etc .; the use of funds is expressed in assets, that is, current assets, long-term assets.

Significant changes in the movement of funds, that is, qualitative changes in the form of funds caused by various economic operations.

The fund movement is closely related to accounting. It is generally believed that the fund movement is the object of socialist accounting. The movement of total social funds is the object of macro accounting, the movement of individual funds is the object of micro accounting, and the movement of corporate funds is the object of corporate accounting. Because the movement of corporate operating capital is typical, it will be highlighted below. The movement of operating funds is the circulation and turnover of corporate funds at different stages of the business process.

For example, the funds of industrial enterprises go through three stages in the movement:

(1) Preparation stage. At this stage, the enterprise uses the form of monetary funds to transform it into a form of funds.

(2) Production stage. At this stage, laborers and means of production are combined to produce products that meet the needs of society, and the form of reserve funds is transformed into the form of production funds.

(3) Sales stage. The enterprise sells the products it produces, recovers the currency from circulation, and the funds return to the form of monetary funds. Starting from monetary funds, the operating capital of an enterprise passes through different stages, sequentially changes the form, realizes different functions, and finally returns to the original form. This process is called the capital cycle. The recurring capital cycle is called capital turnover.