CAPITAL CHARGE Definition

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CAPITAL CHARGE is a monetary amount, calculated by multiplying the money the business has tied up in capital, by the weighted average cost of capital (WACC). Capital charge is deducted from net operating profit after tax to arrive at Economic Profit.

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CAPITAL INVESTMENT see CAPITAL EXPENDITURE.

BANK RECONCILIATION is the verification of a bank statement balance and the depositor's checkbook balance.

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