Lesson Plan

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Lesson Plan
Grade: Date: 17/01/2026
Subject: Accounting
Lesson Topic: Return on capital employed (ROCE)
Learning Objective/s:
  • Describe the purpose and definition of ROCE.
  • Calculate ROCE using both methods for capital employed.
  • Interpret ROCE results and compare them with a company’s cost of capital.
  • Analyse trends in ROCE over multiple periods.
  • Evaluate why ROCE is a more suitable performance measure for capital‑intensive businesses than simple profit margin.
Materials Needed:
  • Projector or interactive whiteboard
  • Printed worksheet with financial‑statement extracts
  • Calculator or spreadsheet software
  • ROCE formula handout
  • Example balance sheet and income‑statement copies
  • Whiteboard and markers
 Introduction:
Begin with a quick question: “If you invested £1,000 in a business, how would you know if it’s using your money efficiently?” Review that students already understand profit and basic ratios. Explain that today they will learn to calculate and interpret ROCE and will be able to assess a company’s performance against its cost of capital.
Lesson Structure:
  1. Do‑now (5'): Solve a simple profit‑margin problem to activate prior knowledge.
  2. Mini‑lecture (10'): Define ROCE, present the formula, and discuss its components.
  3. Guided practice (15'): Walk through the XYZ Ltd example on the board; students complete each step on the worksheet.
  4. Pair activity (10'): Using a second data set, pairs calculate ROCE both ways and verify with calculators.
  5. Interpretation discussion (10'): Groups compare their ROCE to a given cost of capital and suggest reasons for high or low values.
  6. Exam question practice (10'): Attempt a past‑paper ROCE question; teacher provides rapid feedback.
  7. Exit ticket (5'): Write one sentence summarising why ROCE is useful.
Conclusion:
Recap the steps for calculating ROCE and its interpretation. Collect exit tickets as a quick retrieval check. Assign homework: complete a worksheet that requires calculating ROCE for three consecutive years and writing a brief trend analysis.