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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › F2 paper question
Hi,
I am a little unclear with question 11 on pilot paper F2 Dec 2011.
The question is:
A company has a capital employed of $200,000. It has a cost of capital of 12% per year. Its residual income is $36000.
What is the company’s return on investment?
Answer is (A) which in this answer gain is added to cost, and the formula as I understand subtracts the cost. So I am little confused as to why this is added?
Do you know of any good reason why this is posted on the F4 ask the tutor page?
Why not post it in the chat room or in the F2 forum?