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I have a question regarding Return On Capital Employed (ROCE) method In the formula ROCE = Annual average accounting profit / INITIAL INVESTMENT x 100
I have a question regarding Return On Capital Employed (ROCE) method
In the formula
ROCE = Annual average accounting profit / INITIAL INVESTMENT x 100
There are also ROCE = Annual average accounting profit / AVERAGE INVESTMENT x 100
Why are there two methods? and AVERAGE INVESTMENT is used when there is a scrap value??
AVERAGE INVESTMENT = (initial investment + scrap value) / 2
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