The following details have been extracted from the financial statements of a limited company.

statement of profit or loss for the year

profit from operations $59 800
finance costs $12000
profit for the year $47 800

statement of financial position at the year end

equity
ordinary share capital $700000
retained earnings $72500
total equity $772 500
non-current liabilities
10% debentures $120000

What was the return on capital employed?

This question tests Ratio Analysis in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

This question appeared in the Cambridge A-Level Accounting Oct/Nov 2025 examination, Paper 1 Variant 2 (9706_w25_qp_12.pdf).

Question

The following details have been extracted from the financial statements of a limited company.

statement of profit or loss for the year

profit from operations $59 800
finance costs $12000
profit for the year $47 800

statement of financial position at the year end

equity
ordinary share capital $700000
retained earnings $72500
total equity $772 500
non-current liabilities
10% debentures $120000

What was the return on capital employed?

Oracle Prep · Accepted Answer

The correct answer is C: 6.70%.

✓ Correct Answer