Data for the investment centers for Kaspar Company are given in BE22-9. The centers expect the following

Question:

Data for the investment centers for Kaspar Company are given in BE22-9. The centers expect the following changes in the next year:
(I) Increase sales 15%;
(II) Decrease costs $400,000;
(III) Decrease average operating assets $500,000.
Compute the on investment (ROI) for each center. Assume center I has a percentage of 70%.

Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes... Expected Return
The expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these...