How to work out the return on capital emplyed please?
topcat
Registered Posts: 452
Hi everyone,
I am trying to work out the Return on Capital Employed for Staylite LTD
I know the formula for ROCE is
operating profit
Non current assents + net current assets X 100%
but i am getting the wrong percentage compared to the answer
I am doing
3,467
600+198-182
which is 5.62%
a bit off the answer of 65.4%
Untitled by AdamSWilkinson, on Flickr
I am trying to work out the Return on Capital Employed for Staylite LTD
I know the formula for ROCE is
operating profit
Non current assents + net current assets X 100%
but i am getting the wrong percentage compared to the answer
I am doing
3,467
600+198-182
which is 5.62%
a bit off the answer of 65.4%
Untitled by AdamSWilkinson, on Flickr
0
Comments
-
Hi Topcat! Use Operating Profit, not Gross Profit for ROCE. 403 / 616 x 100 = 65.42%0
-
Hi Topcat,
Your on the right line. R.O.C.E. is Operating Profit/ Total Equity + Non-Current Liabilities * 100%
which from the question is 403 / 616 * 100% = 65.4% The 616 is 450+166!
Hope this helps!
Kevin0 -
thank you both i was being blind and looking at the wrong figure for the top half of the equation :blushing:
you have saved me pulling any more hair out0
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