CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales

Question:

CommercialServices.com provides business-to-business services on the Internet. Data concerning the most recent year appear below:
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,000,000
Net operating income . . . . . . . . . . . . . . $ 150,000
Average operating assets . . . . . . . . . . . . $ 750,000

Required:
Consider each question below independently. Carry out all computations to two decimal places.
1. Compute the company’s return on investment (ROI).
2. The entrepreneur who founded the company is convinced that sales will increase next year by 50% and that net operating income will increase by 200%, with no increase in average operating assets. What would be the company’s ROI?
3. The chief financial officer of the company believes a more realistic scenario would be a $ 1,000,000 increase in sales, requiring a $ 250,000 increase in average operating assets, with a resulting $ 200,000 increase in net operating income. What would be the company’s ROI in this scenario?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...