This question appeared in the June 2015 exam. At the start of the year, a division has non-current assets of $4 million and makes no additions or disposals during the year. Depreciation is charged at a rate of 10% per annum on all non-current assets held at the end of the year. Working capital is $0.5 million at the start of the year although this is expected to increase by 20% by the end of the year. The budgeted profit of the division after depreciation is $1.2 million. What is the expected ROI of the division for the year, based on average capital employed?
A、27.59%
B、26.37%
C、18.39%
D、31.58%
A、27.59%
B、26.37%
C、18.39%
D、31.58%
【参考答案及解析】
Opening capital employed = $4m + $0.5m = $4.5m Closing capital employed = ($4m × 0.9) + ($0.5m × 1.2) = $3.6m + $0.6 = $4.2m Average capital employed = $4.35m Profit after depreciation = $1.2m Therefore ROI = $1.2m/$4.35m = 27.59%
Opening capital employed = $4m + $0.5m = $4.5m Closing capital employed = ($4m × 0.9) + ($0.5m × 1.2) = $3.6m + $0.6 = $4.2m Average capital employed = $4.35m Profit after depreciation = $1.2m Therefore ROI = $1.2m/$4.35m = 27.59%