Recreation Equipment Company has several divisions which are investment centers. Data for the Boat Division and the Trailer Division are shown here:

Which of the following statements would be the most meaningful interpretation of this data?

A) Performance of Boat Division is better than that of Trailer Division because Boat Division has higher assets.

B) Trailer Division uses its assets more efficiently than Boat Division because it has higher ROI.

C) Boat Division shows more efficient use of assets than Trailer Division because it has higher operating income.

D) Boat Division is more financially successful than Trailer Division because it shows an increase in assets

Transcribed Image Text:

Operating income Total assets at Jan 1 Total assets at Dec 31 Boat Division $90,000 $670,000 $710,000 Trailer Division $36,000 $230,000 $220,000 Operating income Total assets at Jan 1 Total assets at Dec 31 Boat Division $90,000 $670,000 $710,000 Trailer Division $36,000 $230,000 $220,000

Answer rating: 100% (QA)

B Trailer Division uses its assets more efficiently ... View the full answer