Can be defined as the rate of return that the firm makes on its invested capital which is calculated by dividing the net profits of the firm by total invested capital *?
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Can be defined as the rate of return that the firm makes on its invested capital?Profitability can be defined as the rate of return that the firm makes on its invested capital (ROIC), which is calculated by dividing the net profits of the firm by total invested capital.
What is the rate of return on invested capital how is it calculated?To calculate return on invested capital, divided net operating profit after tax by invested capital. If a firm had a net operating profit after tax (NOPAT) of $10 million and $100 million of invested capital, it would be generating an ROIC of 10%.
What is the rate of return on capital?Return on capital (ROC) is a ratio used in finance, valuation, and accounting. The ratio is estimated by dividing the after-tax operating income (NOPAT) by the book value of invested capital. Return on capital (ROC), or return on investment (ROI), is one the most important ratios to measure profitability of a company.
How is the rate of return of a financial asset defined?A rate of return (RoR) is the net gain or loss of an investment over a specified time period, expressed as a percentage of the investment's initial cost. 1 When calculating the rate of return, you are determining the percentage change from the beginning of the period until the end.
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