Colt Division had the following results for the year just ended: Sales $646,600 Controllable margin $51,740...

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Colt Division had the following results for the year just ended: Sales $646,600 Controllable margin $51,740 Contribution margin 258,600 Average operating assets 260,000 Colt is considering a new product line that would involve the following: Sales $129,300 Controllable margin $10,400 Contribution margin 51,740 Average operating assets 65,000 Colt's parent company, North Inc., has a company-wide ROI of 14% and pays bonuses based on divisional ROI. Determine the effect on Colt's ROl if it introduces the new product line. Colt's ROI Would Colt's managers be encouraged to introduce the new product line? e Textbook and Media Determine the effect on North Inc's ROI if Colt introduces the new product line. North Inc's ROI Would the top managers of North Inc. want to introduce the new product line? eTextbook and Media Assume a required rate of return of 10% on operational assets invested in each division. Determine the effect on Colt's residual income if it introduces the new product. Colt's residual income Would Colt's managers be encouraged to introduce the new product? e Textbook and Media Colt Division had the following results for the year just ended: Sales $646,600 Controllable margin $51,740 Contribution margin 258,600 Average operating assets 260,000 Colt is considering a new product line that would involve the following: Sales $129,300 Controllable margin $10,400 Contribution margin 51,740 Average operating assets 65,000 Colt's parent company, North Inc., has a company-wide ROI of 14% and pays bonuses based on divisional ROI. Determine the effect on Colt's ROl if it introduces the new product line. Colt's ROI Would Colt's managers be encouraged to introduce the new product line? e Textbook and Media Determine the effect on North Inc's ROI if Colt introduces the new product line. North Inc's ROI Would the top managers of North Inc. want to introduce the new product line? eTextbook and Media Assume a required rate of return of 10% on operational assets invested in each division. Determine the effect on Colt's residual income if it introduces the new product. Colt's residual income Would Colt's managers be encouraged to introduce the new product? e Textbook and Media

Answer rating: 100% (QA)

B C D Solution to part i Colts ROI from new produ 1912 3 Decision Colts managers would not be encour... View the full answer