Rate of return on capital employed: During the past year a company had net income $40,000...
Rate of return on capital employed: During the past year a company had net income $40,000 sales $200,000 and total capital employed $400,000
Required: Rate of return on capital employed
Homework Answers
Return on capital employed ( ROCE) = Net income / capital employed * 100
It indicates how much return has the business earned during the year in % terms on the money employed in the business.
ROCE = Net income / capital employed *100
=$40000/ $400000* 100
ROCE =10%
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Rate of return on capital employed: During the past year a
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