Enter the EBIT and fixed capital into the ROEC calculator. The calculator will return the ROEC in percent.

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## Return on Employed Capital Formula

The following formula is used to calculate the percent return on employed capital.

ROEC = EBIT / FC * 100

- Where ROEC is the return on employed capital (%)
- EBIT is the earnings before interest and tax
- FC is the fixed capital.

This formula can be substituted to include EBITDA instead of EBIT which is simply the earnings before interest and tax minus debts.

## Return on Employed Capital Definition

Return on Employed Capital, or ROEC for short, is a measure of the growth or return of a certain amount of capital in an investment or asset.

## How to calculate a return on Employed Capital?

How to calculate return on employed capital

**Determine the EBIT**EBIT is short for earnings before tax and interest. This can show how much a company earns from investments.

**Find the fixed capital**Determine the fixed capital amount. This is how much money a specific company has invested.

**Calculate the ROEC**Enter the information from steps 1 and 2 into the calculator to evaluate the return on employed capital.

## FAQ

**What is return on employed capital?**

ROEC for short, is a measure or ratio of the investments of a company compared to it’s earnings.

**What does ROEC mean?**

ROEC can tell us how efficient one company is over another when it comes to returns on capital spent.

**How do companies improve ROEC?**

This is done mainly through the use of several management tools for reducing costs and increasing returns.