Calculation Of Return On Capital Employed Residual Income And Economic Value Added

Question

A) Present an evaluation of the current performance of your chosen company using ROCE, RI, EVA and SVA. (All figures employed should be up to date, i.e. include the latest published financial statement clearly explained / justified and any performance comparisons within industries and / or between countries explained). In regards to EVA the following key adjustments should be considered with omissions being justified.

  • Non-cash expense e.g. Goodwill
  • Provisions such as bad debts
  • Interest on Debt
  • R&D charges
  • Accounting Depreciation
  • Economic Depreciation
  • Costs relating to non-capitalized Leases
  • Profit / income from marketable securities
  • Unusual gains or losses (-/+)
  • +Restructuring charges/profits
  • +Minority shareholder interests - share of profit
  • Deferred tax charges
  • Tax provision for year
  • Actual tax paid

B) Critically evaluate the usefulness of ROCE, EVA and SVA in assessing company performance. Note: you must make reference to journal articles in this section and reflect on your own experiences of using these techniques.

 

Summary

The question belongs to Finance and it discusses about calculation of Return on capital employed, residual income, economic value added for a chosen company.

Total Word Count 2865

Download Full Solution

Comments

  • HWA
    Rasha

    this is a very good website

  • HWA
    maani

    I have 50 questions for the same test your page is showing only 28

  • HWA
    joeanne

    hi can you please help or guide me to answer my assignments. thanks

  • HWA
    joeanne

    hi can anyone help or guide me to my assignments. thanks

  • HWA
    Monik


  • HWA
    Cristina

    This solution is perfect ...thanks

  • HWA
    Janete

    Hello Allison,I love the 2nd image that you did! I also, had never heard of SumoPaint, is something that I will have to exolpre a bit! I understand completely the 52 (or so) youtube videos that you probably watched. Sometimes they have what you want, sometimes they don't! However, it is always satisfying when you are able to produce something that you have taught yourself. Great job!Debra 0 likes

  • HWA
    Sandeep

    Perfect bank of solution. 

  • HWA
    Oxana

    great !

  • HWA
    Paul Brandon-Fritzius

    thanks for the quick response. the solution looks good. :)

  • HWA
    tina Johnson

    thnx for the answer. it was perfect. just the way i wanted it. 

  • HWA
    Giuseppe

    works fine.