This document discusses return on invested capital (ROIC) and profitability analysis. It defines ROIC as income divided by invested capital and identifies three key applications of ROIC: (1) measuring managerial effectiveness, (2) measuring profitability, and (3) as a measure for planning and control. The document outlines different measures of invested capital, including net operating assets and stockholders' equity. It also discusses how to calculate ROIC using these measures and the importance of making adjustments to invested capital and income numbers for effective analysis.