Is it true that in return on capital employed under operating cashflows we need to deduct depreciation, but in operating profits depreciation was already deducted so no need to deduct them again
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Is it true?
5y ago#1Yes, it is true!
Operating profit is after charging depreciation. Depreciation is not a cash flow and so the operating cash flow is before charging depreciation.
The ROCE is a profit measure and so uses the operating profit (which is after depreciation).
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