Versions of ROCE Formula

Return on Capital Employed
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Return on Capital Employed > Best Practices > Versions of ROCE Formula

Versions of ROCE Formula
Kate
I am a bit confused: why are there so many different variations of the same formula for example I was told that ROCE was Net Profit divided by Fixed Assets plus Current Assets ? (...) Read more? Sign up for free

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  Financial Management
Abhishek Bhatt
  Kate, I would like to answer your question that a same formula can be expressed in a number of ways. As you said that ROCE =NP / FA + CA.
Above formula can also be expressed as : EBIT(net profit) / (Fixed Assets + Net Current Assets and Not Current Assets) or (Net worth + long term liabilities).

  Confusion
Franky Chen
  Someone insists that ROCE = Operating Income After Tax / Operating Assets. Here is EBIT. Is it misunderstanding?

  To Franky
Jaap de Jonge, Editor, Netherlands
  Yes, is misunderstanding. EBIT is the same as Operating Profit !

   
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Return on Capital Employed
Summary
Forum
Acceptable Level of ROCE
ROCE Lower than Borrowing Rate
🔥Evaluating Investment Returns Into the Future by using Return on Capital
Best Practices
🥇What is Return on Average Capital Employed (ROACE). Definition
Versions of ROCE Formula


Return on Capital Employed
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