Gary was evaluated based on his business unit's total ROI, but he also had an incentive...
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Gary was evaluated based on his business unit's total ROI, but he also had an incentive specifically tied to his profit margin to encourage him to reduce expenses. Last year, his division had total ROI of 10%, with a profit margin of 5%. This year, his division earned $33,480 of operating income on $558,000 of sales. Average total assets in his division this year were $344,000. (a1) State the profit margin and investment turnover in Gary's business unit. (Round profit margin to 2 decimal places, e.g. 0.25. Round asset turnover and ROI to 4 decimal places, e.g. 15.2516.) Profit margin Investment turnover Profit margin Current Year (a2) Did he meet or exceed his last year's profit margin and ROI levels? ROI Prior Year Gary was evaluated based on his business unit's total ROI, but he also had an incentive specifically tied to his profit margin to encourage him to reduce expenses. Last year, his division had total ROI of 10%, with a profit margin of 5%. This year, his division earned $33,480 of operating income on $558,000 of sales. Average total assets in his division this year were $344,000. (a1) State the profit margin and investment turnover in Gary's business unit. (Round profit margin to 2 decimal places, e.g. 0.25. Round asset turnover and ROI to 4 decimal places, e.g. 15.2516.) Profit margin Investment turnover Profit margin Current Year (a2) Did he meet or exceed his last year's profit margin and ROI levels? ROI Prior Year
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Related Book For
Management Accounting
ISBN: 9780730369387
4th Edition
Authors: Leslie G. Eldenburg, Albie Brooks, Judy Oliver, Gillian Vesty, Rodney Dormer, Vijaya Murthy, Nick Pawsey
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