Expected return on invested capital
Expected return on invested capital (also known by its acronym, EROIC) is equal to expected NOPAT divided by the amount of capital that is available at the beginning of the year.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- EROIC. Expected return on invested capital is equal to expected NOPAT divided by the amount of capital that is available at the beginning of the year.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
