The following numbers were calculated from the financial statements for a firm for 2012 and 2011:

Explain how much of the change in ROCE from 2011 to 2012 is due to operating activities and how much is due to financing activities. Box 13 .8 will help you.

Transcribed Image Text:

2012 2011 Return on common equity (ROCE) Return on net operating assets (RNOA) Net borrowing cost (NBC) Average net financial obligations (millions) Average common equity (millions) 15.2% 11.28% 2.9% $ 2,225 $ 4,756 13.3% 12.75% 3.2% 241 $ 4,173