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# Return on Employed Capital Calculator

If a company has fixed capital and you're curious to know about the return company can generate from it, you can use our Return On Employed Capital Calculator; it shows your company's efficiency as well.

The profit ratio earned by a company from a fixed amount of capital is known as return on employed capital, or it is also narrated as return on capital employed (ROCE). In finance, The ROCE is used to compare the current financial status of your company with others. Moreover, it is also used to find how efficient a company is. If the capital's values are more significant than the return on employed capital, then we can say that a company's efficacy rate is not valuable for shareholders. And if the capital's values are less significant than the return on employed capital, then we can say that a company's efficacy rate is more valuable for shareholders.

## Formula of Return on Employed Capital Calculator

To find the ROCE manually, you can use the formula listed below or use our return on the Employed capital calculator to find the solution quickly.

But before jumping to the formula, you must know the components necessary to get the final value of ROCE. The components used to find ROCE are:

• EBIT - Earnings Before Interest and Taxes (you can use our EBIT calculator to find it instantly)

• Value of fixed capital

ROCE = EBIT / fixed capital * 100

Note:

To calculate the net profit margin, you can use our Net Profit Margin Calculator.

### Example

For a more precise understanding of the net profit margin concept, let us have an example below:

In the last year, Suppose a multinational company generated revenue of $1,500,000, and as stated in its cash flow statement,$155,000 is the net income/profit earned by it. Now calculate the net profit margin earned by a company.

Given data

EBIT = $20,500 Fixed capita=$114,890

To Find

Return on employed capital = ?

Solution

By using the formula listed above, we will solve this problem.

ROCE = EBIT / fixed capital * 100

Putting values in the formula:

ROCE = 20,500 / 114,890 * 100%

The rate of return on employed capital an XYZ company gains is 17.843%

### How to use the Return on Employed Capital Calculator?

The steps to use the return on the employed capital calculator are as follows:

Step 1: Enter the value of EBIT in the first required input.

Step 2: Enter the value of fixed capital in the second required input.

Step 3: The calculator will automatically display an answer on the screen.

### Calculator use

To quickly get the ROCE, you can use our Return On Employed Capital Calculator. It will immediately display the answer on the screen after you enter the required values.