Return on capital supplied

Question 1

Return on capital employed

Answer 1

Profit before finance charges and tax
/
Average capital employed
x 100/1

Question 2

Return on owner’s equity

Answer 2

Profit after tax and preference share
/
Average ordinary shareholders
x 100/1

Question 3

Earnings per share

Answer 3

Profit after tax - preference dividends
/
Number of ordinary share
x 100/1

Question 4

Dividend payout ratio

Answer 4

Dividends
/
Earnings

Question 5

Return on capital employed ratio

Answer 5

Profit before finance charges and tax
÷
Average capital employed
x 100/1

Question 6

Return on owner’s equity ratio

Answer 6

Profit after and preference dividends
÷
Average ordinary shareholders
x 100/1

Question 7

Return on assets ratio

Answer 7

Profit before finance charges and tax
÷
Average total assets
x 100/1

Question 8

earnings per ordinary share

Answer 8

Profit after tax less preference dividends
÷
Number of ordinary shares
x 100/1

Question 9

Dividends per share ratio

Answer 9

Ordinary (or preference) dividends
÷
Number of ordinary (or preference) shares
x 100/1

Question 10

Ordinary dividend payout ratio

Answer 10

Dividends per share
÷
Earnings per share
Or
dividends/ earnings