Return on Invested Capital (ROIC) is a profitability or performance measure that indicates how much return a company is generating on its invested capital. It is calculated as Net Operating Profit After Tax (NOPAT) divided by Invested Capital.

Let's go through each statement:

a. Obtain tax benefits through taking on debt - This can improve a company's after-tax profits, but it doesn't necessarily improve ROIC. In fact, taking on too much debt can increase a company's financial risk and potentially decrease its ROIC.

b. Minimise restructuring charges - This can improve a company's net operating profit, which would increase its ROIC.

c. Reduce expenses related to pensions - This can also improve a company's net operating profit, which would increase its ROIC.

d. Use research asset efficiently to generate revenue - This can improve a company's revenue and net operating profit, which would increase its ROIC.

So, the correct answer is:

e. All of the above

Each of these actions can potentially improve a company's ROIC, but they should be considered in the context of the company's overall financial situation and strategy.

Question

Return on Invested Capital (ROIC) is a profitability or performance measure that indicates how much return a company is generating on its invested capital. It is calculated as Net Operating Profit After Tax (NOPAT) divided by Invested Capital.

Let's go through each statement:

a. Obtain tax benefits through taking on debt - This can improve a company's after-tax profits, but it doesn't necessarily improve ROIC. In fact, taking on too much debt can increase a company's financial risk and potentially decrease its ROIC.

b. Minimise restructuring charges - This can improve a company's net operating profit, which would increase its ROIC.

c. Reduce expenses related to pensions - This can also improve a company's net operating profit, which would increase its ROIC.

d. Use research asset efficiently to generate revenue - This can improve a company's revenue and net operating profit, which would increase its ROIC.

So, the correct answer is:

e. All of the above

Each of these actions can potentially improve a company's ROIC, but they should be considered in the context of the company's overall financial situation and strategy.

Knowee AI · Accepted Answer

Return on Invested Capital (ROIC) is a profitability or performance measure that indicates how much return a company is generating on its invested capital. It is calculated as Net Operating Profit After Tax (NOPAT) divided by Invested Capital.

Let's go through each statement:

a. Obtain tax benefits through taking on debt - This can improve a company's after-tax profits, but it doesn't necessarily improve ROIC. In fact, taking on too much debt can increase a company's financial risk and potentially decrease its ROIC.

b. Minimise restructuring charges - This can improve a company's net operating profit, which would increase its ROIC.

c. Reduce expenses related to pensions - This can also improve a company's net operating profit, which would increase its ROIC.

d. Use research asset efficiently to generate revenue - This can improve a company's revenue and net operating profit, which would increase its ROIC.

So, the correct answer is:

e. All of the above

Each of these actions can potentially improve a company's ROIC, but they should be considered in the context of the company's overall financial situation and strategy.

Which of the following improves a company's return on invested capital (ROIC)? 0 a. Obtain tax benefits through taking on debt 0 b. Minimise restructuring charges O c. Reduce expenses related to pensions 0 d. Use research asset efficiently to generate revenue 0 e. All of the above

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