What this calculator does
Return on capital employed (ROCE) works out operating profit generated per dollar of capital tied up in the business. Enter your own figures above and the answer updates as you type: nothing is fixed in the code, so the result reflects exactly the numbers you supply.
The formula this calculator evaluates is printed under the tool and explained below, so you can check the working by hand or reuse it in a spreadsheet.
The formula
FormulaCapital employed = Total assets − Current liabilities; ROCE = EBIT / Capital employed
The inputs explained
| Field | What to enter |
|---|---|
| EBIT (operating profit) ($) | A number, measured in your currency. Starts at 180000. |
| Total assets ($) | A number, measured in your currency. Starts at 1200000. |
| Current liabilities ($) | A number, measured in your currency. Starts at 200000. |
Worked examples
Every figure in the tables below is produced by this page’s own calculator at build time, so the numbers and the tool always agree. Select any row to load that scenario.
How the answer changes with ebit (operating profit)
Every other input is held at the calculator’s starting values while ebit (operating profit) varies. Select any row to load that scenario into the calculator.
How the answer changes with ebit (operating profit)
| EBIT (operating profit) ($) | Return on capital employed | Capital employed | Reading |
|---|---|---|---|
| 90,000 | 9.00% | $1,000,000.00 | Weak: operating profit is thin relative to capital employed |
| 135,000 | 13.5% | $1,000,000.00 | Moderate operating return on capital |
| 180,000 | 18.0% | $1,000,000.00 | Moderate operating return on capital |
| 270,000 | 27.0% | $1,000,000.00 | Strong: capital is generating a high operating return |
| 360,000 | 36.0% | $1,000,000.00 | Strong: capital is generating a high operating return |
| 540,000 | 54.0% | $1,000,000.00 | Strong: capital is generating a high operating return |