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Practical Use Of Economic Profit To Assess The Effectiveness Of Activities

Table 4: Analysis of the efficiency of "Volchikhinsky Brewery" CJSC

Indicator Year Growth or decline
2017 2018 2019 2018/ 2017 2019/ 2018
1. Net accounting profit, RUB thousands 3722 -18772 578 -504.3 -3.08
2. Average annual cost of equity, RUB thousands 328696 320053 310956 -8643 -9097
3. Average annual cost of invested capital, RUB thousands 352046 335553 317956 -16493 -17597
4. Rate of return on invested capital (bank interest on deposits), % 6 7 5 1 -2
5. Normal profit after tax (p. 3 · p. 4 – p. 3 · p. 4 ·20%), RUB thousands 16898 18791 12718 1893 -6073
6. Economic profit (loss) (p. 1 – p. 5), RUB thousands -13176 -37563 -12140 -24387 25423
7. Return on equity (ROE = p. 1 / p. 2 ·100), % 1.1 -6 0.2 -7.1 6.2
8. Return of invested capital on economic profit (p. 6 / p. 3 ·100), % -1 -11 -4 -10 7
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