ROCE calculator is a ready-to-use excel template to calculate ROCE for any company and compare ROCE for 5 years for investing purpose. ROCE is means Return on capital employed of a business just by entering a few inputs.
In addition to that, 4 different ways to calculate EBIT and CE are also given if you don’t have EBIT or CE figures available.
Furthermore, you can compare ROCE of 5 years for any company using this template.
Return on capital employed is a profitability ratio which measures the capacity of a company to generate profits from the employed in the functioning of a business.
You can calculate ROCE using the following formula: Operating Profit of ( EBIT) divided by Capital Employed.
The higher the return on capital employed means more the profits earned.
Where:
Operating Profit means profits earned before deducting interest and tax expenses. It is also referred to as EBIT. To understand EBIT in detail click on this link: EBIT.
AND
Capital Employed(CE) refers to the total amount of debt and equity funds of a business.
We have created a simple and useful ROCE calculator Excel template with predefined formulas. Just enter a few details and you can derive ROCE of a company as well as compare ROCE of 5 years.
Click here to download the ROCE Calculator Excel Template.
You can download other useful templates like Portfolio Analysis With BSE Bhav Copy, Income Tax Calculator FY 2018-19 and Loan Amortization Template.
This template consists of 3 sections:
In this section, insert EBIT(Earnings Before Interest and Taxes) and CE(Capital Employed) amounts to derive ROCE of any company.
Many times it happens that EBIT and CE figures aren’t available in annual reports or financial statements. In such cases, you can calculate both in 4 different ways that we will discuss in the below section.
As soon as you enter the EBIT and CE amounts, the template automatically calculates ROCE by applying the above-mentioned formula.
When the value of EBIT and capital employed is not directly known, the first step is to calculate EBIT and capital employed. To do so here are 4 ways to calculate both EBIT and CE. You can use any combinations to derive ROCE.
To calculate Operating Profit or EBIT, you will require elements of the Profit and Loss Account. You can calculate EBIT in 4 different ways as follows:
All the above 4 ways for calculating EBIT have been added to the template which helps you to easily calculate EBIT.
We require the elements Balance Sheet of a company to calculate Capital Employed. You can calculate CE in 4 ways which are as follows:
In this section, you can compare the ROCE of consecutive 5 years of any company to observe the profitability of a company.
Enter the required data for calculation of EBIT and Capital employed from the financial statements for all the 5 years. The template will calculate ROCE for all those years and give you the comparison of the company’s profitability over those 5 years.
The line items will be entered by taking into account the representation of financial statements based on industry standards.
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