Capital Employed = Funds + Long Term Debts Shareholder’s = Rs.2,40,000 + Rs.4,00,000 = Rs.6,40,000 Return on Capital Employed = Net Profit before Interest and Tax = 2,00,000 x 100 = 31.25% Capital employed 6,40,000 Note : It is assumed that Funds include current profits. Shareholder’s year’s
Capital Employed = Shareholder’s Funds + Long Term Debts = Rs.2,40,000 + Rs.4,00,000 = Rs.6,40,000 Return on Capital Employed = Net Profit before Interest and Tax = 2,00,000 x 100 = 31.25% Capital employed 6,40,000 Note : It is assumed that Shareholder’s Funds include current year’s profits.
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