1. Karl and Grady are managers of two product lines for Brewster Company. One of them is...
Question:
1. Karl and Grady are managers of two product lines for Brewster Company. One of them is a candidate for promotion based on performance. Using the data he below, determine who had the better performance using performance measures including as net income, profit margin and return on investment. Show your calculations and support your answer.
| Karl | Grady |
Revenue | $412.000 | $450,000 |
Costs | 380.000 | 411,000 |
Average Assets | 400,000 | 600,000 |
2. Use the Hamilton Company's investment center information below to calculate (a) return on total investment and (b) investment center residual income.
Net Income ………………… $315,900
Average Invested Assets …… $2,100,000
Target Net Income………….. 6% of division assets
Intermediate Accounting Reporting and Analysis
ISBN: 978-1111822361
1st edition
Authors: James M. Wahlen, Jefferson P. Jones, Donald Pagach