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E$10-6($Algo$)$ Calculating Return on Investment, Residual Income, Determining Effect of Changes in Sales, Expenses, Invested Assets, Hurdle Rate on Each $[$LO $10-4,10-5]$

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Solano Company has sales of $$580,000,$ cost of goods sold of $$410,000,$ other operating expenses of $$54,000,$ average invested assets of $$1,800,000,$ and a hurdle rate of $9$ percent.

Required:

Determine Solano's return on investment $($ ROI $),$ investment turnover, profit margin, and residual income.

Several possible changes that Solano could face in the upcoming year follow. Determine each scenario's impact on Solano's ROI and residual income. $($Note: Treat each scenario independently.$)$

a$.$ Company sales and cost of goods sold increase by $30$ percent.

b$.$ Operating expenses decrease by $$13,500.$

c$.$ Operating expenses increase by $10$ percent.

d$.$ Average invested assets increase by $$340,000.$

e$.$ Solano changes its hurdle rate to $15$ percent.

Complete this question by entering your answers in the tabs below.

Req $1$

Req $2$A

Req $2$C

Req $2$D

Req $2$E

Several possible changes that Solano could face in the upcoming year follow. Determine each scenario's impact on Solano's ROI and residual income. $($Note: Treat each scenario independently.$)$ Operating expenses decrease by $$13,500.$ Note: Loss amounts should be indicated with a minus sign. Enter your ROI percentage answer to $2$ decimal places, $($i$.$e$.,0\mathrm{.}1234$ should be entered as $12\mathrm{.}34\%.)$

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