Accounting 9706 · AS & A Level · Analysis and communication of accounting information

Analysis and communication of accounting information — practice question

During 2014, the company was funded wholly by equity and reserves, with a total of $1000000$. Its return on capital employed stood at $28\%$. On 1 January 2015, the company issued a $10\%$ debenture worth $300000$. Over 2015, profit from operations rose by $20\%$. No dividends were paid out. What was the return on capital employed for 2015?

  • A$19.1\%$
  • B$20.9\%$
  • C$23.4\%$
  • D$25.8\%$

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