DFS ratio in course companion

alwa-37

hi all
could u help me solving a ratio ques In DFS course companion, chapter 10, Ratio, pg 236, I dnt knw how to calculate capital employed?






are u using dfs course companion?




thanks

*Sarah*

Hi Alwa

Return on Capital employed is calculated as follows;

Net Profit / capital employed X 100

I'm not sure what course companion is I'm afraid

Sarah

alwa-37

hmm i know the formular but ques asked in a different way so i'm confuesed.. i asked my lecturer but it doesnt work. :001_unsure:




we use couse companion n revision companion in aat


dnt u use it?:confused1:

StevenMorgetroyd

You mention that it is done a different way, it could be that you need to work it out in days rather than a percentage. If that is the case, you need to do "capital employed / Net Profit X 365". This causes a lot of confusion because the capital employed and net profit switch between calculating % or days.

crispy

Hello,

Capital Employed = Equity + Non-current Liabilities or...

Non Current Assets + Current Assets - Current Liabilties (ie: ignore Non-current liabilitIes)

Return On Capital Employed = Operating Profit / Captial Employed X 100

:thumbup1:

alwa-37

thanx but these formulas deosnt work.. its v hard one and i know one way to get the correct ans but i'm not satisfied with the reason given by my tutor:001_unsure:



thats why i want find beter way to do it or beter reason for it:confused1: