Question: Please help solve the answer I got wrong! Thank you! Evaluating Investment Centers Terry Enterprises, Inc. has two divisionsthe Foods division and the Clothes division.
Please help solve the answer I got wrong! Thank you!

Evaluating Investment Centers Terry Enterprises, Inc. has two divisionsthe Foods division and the Clothes division. Historically, Terry has used the division's ROI as the performance measure for the bonus determinations. Terry Foods division has gross total assets of $1,000,000, accumulated depreciation of $350,000, current liabilities of $250,000, and sales of $2,000,000. Foods' operating income is $200,000. Terry Clothes division has gross total assets of $5,000,000, accumulated depreciation of $2,100,000, current liabilities of $1,500,000, and sales of $8,000,000. Clothes' operating income is $750,000. Use the DuPont formula to compute ROI for each division and for Terry Enterprises as a whole. Use operating income and gross total assets as the measures of income and investment. Round answers to the nearest whole percentage. Foods Clothes Terry Enterprises ROI 20 % 15 % 15.83 % x
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
