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Methods Used in Determining the Value Added Used in the Assesment of the Company’s Real Economic Power

Author

Listed:
  • Constantin Căruntu

    (Constantin Brâncuși University of Târgu-Jiu, Romania)

  • Mihaela Loredana Lăpăduși

    (Constantin Brâncuși University of Târgu-Jiu, Romania)

Abstract

When analyzing the value of a product or service, our goal is to obtain a product or service value that exceeds the cost of producing the good or service provision. Their cost includes the value of all resources used in its production, so it is necessary to examine each activity or resources involved in making a product or providing a service. Value added is the indicator that measures the economic performance of an economic entity which has a fairly long history of application at both micro and macro level. The purpose of this article is to set out the determination of the value added of a company through the synthetic and analytical method considered to be methods of determining the increasing level of the wealth of a business and of measuring the income. The research methodology used consists in the application of the two methods for determining the value added, the synthetic and analytical method, and also the use of the factorial method to reveal the factors of influence on value added.

Suggested Citation

  • Constantin Căruntu & Mihaela Loredana Lăpăduși, 2012. "Methods Used in Determining the Value Added Used in the Assesment of the Company’s Real Economic Power," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 12(1), pages 33-48.
    • Handle: RePEc:pet:annals:v:12:y:2012:i:1:p:33-48
    as

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    References listed on IDEAS

    as
    1. Wagner, Alfred, 1891. "Marshall's Principles of Economics," History of Economic Thought Articles, McMaster University Archive for the History of Economic Thought, vol. 5, pages 319-338.
    2. Maja Ilic, 2010. "Economic Value Added As A Modern Performance Indicator," Perspectives of Innovation in Economics and Business (PIEB), Prague Development Center, vol. 6(3), pages 94-97, October.
    3. Ilic, Maja, 2010. "Economic value added as a modern performance indicator," Perspectives of Innovations, Economics and Business (PIEB), Prague Development Center (PRADEC), vol. 6(3), pages 1-4, October.
    4. Ilie Răscolean & Codruța Dura & Claudia Isac, 2008. "The Grounds of the Decision of Financing a Company," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 8(2), pages 135-146.
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    More about this item

    Keywords

    value added; synthetic method; analytical method; economic performance;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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