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

Sales.........................................................$3,000,000
Net operating income.................................450,000
Average operating assets........................1,800,000

Required:

Consider each question below independently. Carry out all computations to two decimal places.

1. Compute the expected margin for Crawford Company.

2. Compute the expected turnover for Crawford Company.

3. Compute the ROI for Crawford Company.

1. Compute the company’s 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 as a result 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 $200,000 increase in average operating assets, with a resulting $150,000 increase in net operating income. What would be the company’s ROI in this scenario?