RETURN ON INVESTED CAPITAL Definition

Bookmark and Share

RETURN ON INVESTED CAPITAL (ROIC) is a measure of how effectively a company uses the money (owned or borrowed) invested in its company operations. It is calculated by: net income after taxes / (total assets less excess cash minus non-interest-bearing liabilities).

Learn new Accounting Terms

PERPETUITY, in finance, is an annuity payable forever.

PURCHASE METHOD is accounting for an acquisition using market value for the consolidation of the two entities` net assets on the balance sheet. Generally, depreciation/amortization will increase for this method (due to the creation of goodwill) compared to the POOLING OF INTEREST METHOD resulting in lower net income.

Suggest a Term

Enter Search Term

Enter a term, then click the entry you would like to view.