Review Case 10.32 in your textbook. Using the questions provided as a guide, discuss your suggested strategy(ies) for improving ROI and the steps that the company would have to implement to obtain the desired result(s).

a. Calculate the margin and asset turnover for Centex Yarns three divisions. Show that margin asset turnover equals the return on investment for each division as reported in the text. b.

b. Compare the margin and asset turnover for the three divisions and make suggestions for increas-ing the return on investment of each division.

I attached the calculation below.

	Polyester Fiber Division	Rope Division	Nylon Fibers Division
Revenue	$ 10,600,000.00	$ 6,725,000.00	$ 8,650,000.00
Less variable expenses
Costs of goods sold	5543000	2368000	4414000
Selling & administrative	1334000	649000	890000
Contribution margin	$ 3,723,000.00	$ 3,708,000.00	$ 3,346,000.00
Less traceable fixed expenses
Costs of goods sold	1685000	1382000	2208000
Selling & administrative	236000	174000	273000
Segment margin	$ 1,802,000.00	$ 2,152,000.00	$ 865,000.00
Common fixed expenses
Net operating income
Segment margin	$ 1,802,000.00	$ 2,152,000.00	$ 865,000.00
Average Assets	$ 8,153,000.00	$ 8,406,250.00	$ 2,703,000.00
	Margin	Asset Turnover	ROI
	Segment/ Sales	Sales/Average Assets	Margin * Asset Turnover
Polyester	17.0%	1.30	22.10%
Rope	32.0%	0.8	25.60%
Nylon	10.0%	3.20	32.00%