The most recent annual report and accounts of the Row Sea Company shows that it made a
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The most recent annual report and accounts of the Row Sea Company shows that it made a profit after tax of £1m last year, and the statement of financial position shows total shareholders’ funds of £10m. It is considering buying a ship that will cost £2m and that will generate operating profits (after charging depreciation) of
£180,000 a year.
Would the investment increase the company’s return on capital employed?
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The companys return on capital employed ROCE is 10 per cent 1m as a percentage of 10m The ROI of t...View the full answer
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