What caused the fall in ROCE? Return on Equity*Return on Capital Employed*Gross profit marginOperating profit marginInterest coverCurrent ratioQuick ratioInventories turnover period*Settlement period for accountsreceivable*Settlement period for accounts payable*Operating cash cycleGearing202216%16.35%37.3%9.4%2.90.690.0372.1 days1.4 days97.2 days?51.5%202129.4%21.6%38.7%13.3%60.710.0962.9 days1.5 days89.3 days?54.9%

Introduction: Return on capital employed(ROCE): ROCE – It is a financial ratio and it is used to…

Answered: Current ratio Quick ratio Inventories…

Business

Accounting

Current ratio Quick ratio Inventories turnover period*

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter5: Evaluating Operating And Financial Performance

Section: Chapter Questions

Problem 9EP

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Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

What caused the fall in ROCE?

Return on Equity*
Return on Capital Employed*
Gross profit margin
Operating profit margin
Interest cover
Current ratio
Quick ratio
Inventories turnover period*
Settlement period for accounts
receivable*
Settlement period for accounts payable*
Operating cash cycle
Gearing
2022
16%
16.35%
37.3%
9.4%
2.9
0.69
0.03
72.1 days
1.4 days
97.2 days
?
51.5%
2021
29.4%
21.6%
38.7%
13.3%
6
0.71
0.09
62.9 days
1.5 days
89.3 days
?
54.9%

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