Personal Finance & Money Asked by hellomynameisasno on April 20, 2021
I am interested in the distinction in the following formulas for ROCE.
The first one is from Financial Management for the academy profession program by L. Hansen, T.R. Jensen, and M. Dalboge.
But Investopedia and every other internet source quantifies ROCE= EBIT/ Capital employed,
where Capital employed = Total Assets – Current Liabilities. This formula makes lot more sense, so Im wondering why does the book quantifies the ROCE in that way.
Thanks for reading and input, have a nice day
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