Answer:
21 %
Explanation:
Return on invested capital is one of the profitability ratios. It measures the returns investors get from their capital investments. ROIC shows efficiency in the use of capital.
the formula is as follows
ROI =( Net income - Dividends ) / ( Debt + Equity )
in this case:
Income = 265,000
debts 110,000 + 349,000= 459,000
equity = 459,000
Net income = 265,000 -(25% x 265,000)
265,000- 66,250= 198,750
ROIC = 198,750/459,000+459,000
=198,000/918,000 x 100
=21 %
