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I provided a question (the balance sheet) and answer (excel). You may refer to the pictures that I added. Can you explain to me where we can get 65% from the question? I refer to the expect's answer and it stated that x(1-tax)= 65%. Where is 65% come from? I am so confused and what's the actual formula for Returned On Invested Capital because I refer to Internet and it have so many different formula.

I provided a question (the balance sheet) and answer (excel). You may refer to the pictures that I added. Can you explain to me where we can get 65% from the question? I refer to the expect's answer and it stated that x(1-tax)= 65%. Where is 65% come from? I am so confused and what's the actual formula for Returned On Invested Capital because I refer to Internet and it have so many different formula.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Hi, I provided a question (the balance sheet) and answer (excel). You may refer to the pictures that I added. Can you explain to me where we can get 65% from the question? I refer to the expect's answer and it stated that x(1-tax)= 65%. Where is 65% come from? I am so confused and what's the actual formula for Returned On Invested Capital because I refer to Internet and it have so many different formula. Hope you can help me because I try to understand this. Thank you so much for your help :)
6 2. Return on invested capital 7 Earnings before interest and tax 8 x (1- tax) 9 Net operating profit after tax $4,156.00 65% $2,701.40 10 11 Invested capital 12 Total current assets 13 (-)total current liabilities 14 working capital 15 Net plant and machimery 16 Invested capital $30,000.00 -$22,000.00 $8,000.00 $20,000.00 $28,000.00 17 Return on invested cap = NOPAT/ 18 Invested capital 9.65% 19
Transcribed Image Text:6 2. Return on invested capital 7 Earnings before interest and tax 8 x (1- tax) 9 Net operating profit after tax $4,156.00 65% $2,701.40 10 11 Invested capital 12 Total current assets 13 (-)total current liabilities 14 working capital 15 Net plant and machimery 16 Invested capital $30,000.00 -$22,000.00 $8,000.00 $20,000.00 $28,000.00 17 Return on invested cap = NOPAT/ 18 Invested capital 9.65% 19
Balance sheet (mi llions of $2 Assets Cash and securities Accounts receivable Inventories Total current assets Net plant and equipment Totai Assets 2500 11500 16000 30 000 20 000 50 000 Liabilities and equity. Acounts payable ACcruals 9500 55 00 7000 Notes payable Total current liabilities २२००० Long term bonds Totål lrabilities 15000 37 000 2000 Common stock Refained earnings Total common equity To tal liabilitier and equity // 000 13000 50 000 Income stafement (milons op $) 87500 8/813 Net SQles Operating cotts except depreciation bepreciation Eamings bef interest and faxes (EBIT) 4156 Less interest Earnings before tax er CEBT) paxes Net income 1531 1375 2781 973 I 80 8 0ther data S hares outstanding Cnillions ) Common diridends Int.rate on notes paya ble 4 d-7 bonds Pederal plus state income tax rate Year end stoch price 500 3२. ३ 6.25 7. 35 /. 43.39
Transcribed Image Text:Balance sheet (mi llions of $2 Assets Cash and securities Accounts receivable Inventories Total current assets Net plant and equipment Totai Assets 2500 11500 16000 30 000 20 000 50 000 Liabilities and equity. Acounts payable ACcruals 9500 55 00 7000 Notes payable Total current liabilities २२००० Long term bonds Totål lrabilities 15000 37 000 2000 Common stock Refained earnings Total common equity To tal liabilitier and equity // 000 13000 50 000 Income stafement (milons op $) 87500 8/813 Net SQles Operating cotts except depreciation bepreciation Eamings bef interest and faxes (EBIT) 4156 Less interest Earnings before tax er CEBT) paxes Net income 1531 1375 2781 973 I 80 8 0ther data S hares outstanding Cnillions ) Common diridends Int.rate on notes paya ble 4 d-7 bonds Pederal plus state income tax rate Year end stoch price 500 3२. ३ 6.25 7. 35 /. 43.39
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