Based on the case study details provided, determine the Return on Investment (ROI) for the firm: - Accountancy MCQ CUET Accountancy 2025 14 May Shift 2 2026 | ExamTest.live | ExamTest.live

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1 mark

Based on the case study details provided, determine the Return on Investment (ROI) for the firm:

A $20.04%$
B $22.14%$
C $24.84%$
D $19.42%$

Solution & Step-by-step Explanation

1. Identify Profit Before Interest and Tax (EBIT): EBIT = Rs. 2, 40, 000 (Calculated in the previous question) Calculate Capital Employed: Capital Employed = Shareholders’ Funds + Long-term Debts (Debentures) Shareholders’ Funds = 4, 00, 000 + 1, 00, 000 + 1, 84, 000 = Rs. 6, 84, 000 Capital Employed = 6, 84, 000 + 4, 00, 000 = Rs. 10, 84, 000 Calculate Return on Investment (ROI) Ratio: ROI = \frac{Profit Before Interest and Tax (EBIT)}{Capital Employed} \times 100 ROI = \frac{2 , 40 , 000}{10 , 84 , 000} \times 100 \approx 22.1399% \approx 22.14%

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Based on the case study details provided, determine the Return on Investment (ROI) for the firm:

A

20.04%

B

22.14%

C

24.84%

D

19.42%

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