How to calculate the profit rate of capital? What's the difference between asset profit rate and capital profit rate? Please explain it in plain language.

The rate of return on capital is the ratio of after-tax profit to paid-in capital (share capital) in a certain period of time, and its calculation formula is as follows:

Return on capital = net profit/paid-in capital × 100%

Asset profit rate, also known as investment profit rate, asset return rate, asset return rate and enterprise capital profit rate, is an index reflecting the profitability of enterprise assets. Refers to the ratio between the profits realized by an enterprise in a certain period and the average assets occupied in the same period. The calculation formula of asset profit rate is: (total profit/average owned assets) × 100%.

Profit rate of capital is a concept of our socialist country, which is actually the profit rate of assets.

The main difference is capital, assets and capital. Capital in the rate of return on capital refers to paid-in capital. Capital refers to the registered capital of an enterprise registered in the administrative department for industry and commerce, so capital is registered capital. However, the paid-in capital and registered capital are sometimes not exactly the same in amount.

. Assets are all assets occupied by enterprises and are the assets of the balance sheet. Generally divided into total assets profit rate and net assets profit rate. Assets and capital are actually the same thing, but since the reform, they have gradually integrated with the international community, and generally do not use the concept of capital.