Question: IThe fooowing information applies to the questions displayed belowJ Larry's Farm Equipment Store has been in business for several years. The firm's owners have described



IThe fooowing information applies to the questions displayed belowJ Larry's Farm Equipment Store has been in business for several years. The firm's owners have described the store as a "high-price, high-service operation that prov des lots of assistance to its cl Margin has averaged a relatively high 34% per year for seve years, but turnover has bee n a relatively low 0.4 based on average total assets of $800,000. A discount Farm Equipment Store is about to open in the area served by Larry's, and management is considering lowering prices to compete effectively. 0.83 points Required: a. Calculate current sales and ROI for Larry's Farm Equipment Store. (Round your "ROI" to 1 decimal place. (e.g., 32.1) Sales ROI b. Assumi ng that the new strategy would reduce margin to 20%, and assuming that verage total assets would stay the same, calculate the sales that would be required to have the same ROI as Larry's currently earns. (Do not round your intermediate calculations
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
