Calculate the return on the capital employed of the firm is

ABC company has a net profit calculated on the replacement cost is OMR 250,000 and the capital employed is OMR 3000000. The return on the capital employed of the firm is a. 10.33% b. 12% C. 8.33% d. 9.33%

Expert Solution

Calculation of Return on the Capital Employed of the Firm

Given information in the problem

Net profit = OMR 250,000

Capital Employed = OMR 30,00,000

Return on Capital Employed =Net profit / Capital Employed * 100%

= 2,50,000 / 30,00,000 * 100%

= 8.33%

Return on Capital Employed of the firm is 8.33%

Hence,option C.8.33% is the correct choice

option c.8.33% is the correct choice

balaji rao answered 2 years ago

EXPLAIN the following appraisal methods; payback period, return on capital employed and net present value. Stating...

EXPLAIN the following appraisal methods; payback period, return on capital employed and net present value. Stating and explaining advantages and disadvantages. (50)

Calculate the rate of return and rate of capital gain for the following bonds given the...

Calculate the rate of return and rate of capital gain for the following bonds given the market interest rate of 9%: Bond A: Matures in 7 years, offers a coupon rate of 12% and has a face value of $10,000 Bond B: Matures in 6 years, offers a coupon rate of 7% and has a face value of $7000

Calculate the weighted average cost of capital for a firm with the following information:

Calculate the weighted average cost of capital for a firm with the following information: Marginal corporate tax rate: 25% Bonds with $1,000 face value with a 6% coupon rate with semi-annual payments matures in 10 years now sells for $928.94 Preferred stock dividend $5.50 Preferred stock price $55.00Current common stock dividend per share $1.50 Price per share of common stock $12.00 Floatation cost to sell new common stock ...

bonds represent liability of a firm and provide return in the form of income and capital...

bonds represent liability of a firm and provide return in the form of income and capital gain? T or F The movement S&p500 index stock is the most important factor in determining price changes of bonds in the market? T 0r F

6. What is the return on equity (RE) of a firm? Explain the ways to calculate...

6. What is the return on equity (RE) of a firm? Explain the ways to calculate it.

Return on Invested Capital (ROIC) is a profitability ratio that measures how effective the firm is...

Return on Invested Capital (ROIC) is a profitability ratio that measures how effective the firm is at generating a return for investors who have provided capital (bondholders and stockholders). The ROIC calculation answers three questions: How tax efficient is the firm? How effective are the firm’s operations? How intensively does the firm use capital? Comparing the answers to these questions between firms can help you understand why one firm is more profitable than another and where that profitability is coming...

Calculate the weighted average cost of capital for the following firm: it has $600000 in debt,...

Calculate the weighted average cost of capital for the following firm: it has $600000 in debt, $400000 in common stock and $200000 in preferred stock. It has a 4% cost of debt, 14% cost of common stock, 12% cost of preferred stock and a 34% tax rate.

Assume that you are employed in the marketing department for a firm that is producing an...

Assume that you are employed in the marketing department for a firm that is producing an electric scooter. In developing this product, you realize that it is important to provide a core product, an actual product, and an augmented product that meets the needs of customers. Develop an outline of how your firm might provide these three product layers in the electric scooter.

What is the risk–return trade-off that arises when a firm manages its working capital? • How...

What is the risk–return trade-off that arises when a firm manages its working capital? • How does a firm’s use of short-term debt as opposed to long-term debt subject the firm to a greater liquidity risk? • explain how accounts receivable are created and managed, and calculate the cost of trade credit

Calculate the Z-score of the firm that has the following ratios: Working capital/total assets = 0.34

Calculate the Z-score of the firm that has the following ratios: Working capital/total assets = 0.34 Retained earnings/total assets = 0.15 EBIT/total assets = 0.00 Market value equity/book value of long-term debt = 0.80 Sales/total assets = 1.6 Round your answer to 2 decimal places. For example, if your answer is 5.689, write down 5.69

Question