Return on Capital Calculator
Return on capital (ROC) is one of the vital ratio for measuring the profit level of a firm. Return on capital helps to measure the amount of money an investment or business can generate on the money invested.
Return on capital can be calculated using the below formula:
Lets understand return on capital with this example,Example:
Company ABC is a manufacturing company that possess $30,000 on net income, equity of shares $30,000 with a total debt of $150,000.Solution:
Given: Net income: $30,000
Formula to calculate return on capital:
Return on Capital = (Net income - Dividends) / (Debt + Equity)
= (30,000 - 0)/(150,000 + 30,000)
Return on capital = 16.6%
You can calculate return on capital by entering the input fields in the below calculator.
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