Selected sales and operating data for three divisions of different structural engineering firms are given as...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Sales Average operating assets Net operating income Minimum required rate of return Required: Division A $ 12,570,000 Division B $ 14,665,000 Division C $ 26,187,500 $ 7,332,500 $ 5,237,500 $ 628,500 $ 586,600 14% 10% $ 838,000 16% $ 3,142,500 1. Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. 2. Compute the residual income (loss) for each division. 3. Assume that each division is presented with an investment opportunity that would yield a 15% rate of return. 8. If performance is being measured by ROI, which division or divisions will probably accept or reject the opportunity? b. If performance is being measured by residual income, which division or divisions will probably accept or reject the opportunity? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 381 Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. (Do not round intermediate calculations. Round your answers to 1 decimal place.) Division A Division B Division C Margin Turnover % % % ROI % % % Req 2 > Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Sales Average operating assets Net operating income Minimum required rate of return Required: Division A $ 12,570,000 Division B $ 14,665,000 Division C $ 26,187,500 $ 7,332,500 $ 5,237,500 $ 628,500 $ 586,600 14% 10% $ 838,000 16% $ 3,142,500 1. Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. 2. Compute the residual income (loss) for each division. 3. Assume that each division is presented with an investment opportunity that would yield a 15% rate of return. 8. If performance is being measured by ROI, which division or divisions will probably accept or reject the opportunity? b. If performance is being measured by residual income, which division or divisions will probably accept or reject the opportunity? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 381 Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. (Do not round intermediate calculations. Round your answers to 1 decimal place.) Division A Division B Division C Margin Turnover % % % ROI % % % Req 2 >
Expert Answer:
Posted Date:
Students also viewed these accounting questions
-
The team's velocity has been 20 story points/sprint. They have 200 points remaining in the backlog for this release. The sprint length is two weeks. How many more weeks will it take to complete the...
-
Palermo Company estimates that unit sales will be 10,000 in quarter 1; 12,000 in quarter 2; 14,000 in quarter 3; and 18,000 in quarter 4. Using a sales price of $80 per unit, prepare the sales budget...
-
Reaction of an alcohol with thionyl chloride in the presence of a tertiary amine (e.g., pyridine) affords replacement of the OH group by Cl with inversion of configuration (Section 11.9). However, if...
-
The relation between a bond's coupon rate and yield rate is known to influence a bond's issuance price. Presented below are coupon rates and yield rates for a selection of corporate bonds. Identity...
-
Billie Bradford worked for the Kentucky Department of Community Based Services (DCBS). One of Bradfords co- workers, Lisa Stander, routinely engaged in extreme sexual behavior (such as touching...
-
Explain any unique market positioning that McCormick has over its rivals.
-
Chumpy Lighting Limited manufactures a wide variety of light bulbs which it sells to lighting shops and builders merchants through wholesale distributors. It also sells direct to the big UK...
-
Prepare your own investment project if assuming that you already have a multinational company, and now you want to broaden your business to one more country. Meaning that you want to establish a new...
-
Consider two independent, identically distributed random variables \(\Theta_{1}\) and \(\Theta_{2}\), each of which obeys a probability density function \[ p_{\Theta}(\theta)=\left\{\begin{array}{cc}...
-
Are growth curves more likely to be effective in forming short-term or long-term forecasts? Why?
-
According to the U.S. Energy Information Administration, the mean monthly household electric bill in the United States in a recent year was $110.14. Assume the amounts are normally distributed with...
-
An ergodic real-valued random process \(U(t)\) with autocorrelation function \(\Gamma_{U}(\tau)=\left(N_{0} / 2 ight) \delta(\tau)\) is applied to the input of a linear, time-invariant filter with...
-
Define normal and tangential components of acceleration.
-
You invest $8000 in a floating rate guaranteed investment certificate. For the first 24 months you earn 6% compounded semi-annually. For the next 6 months you earn 12% compounded monthly. What is the...
-
If your school has a subscription to the FASB Codification, go to aaahq.org/ ascLogin.cfm to log in and prepare responses to the following. (a) What is the stock dividend? (b) What is a stock split?...
-
Show that any training set \(\tau=\left\{\left(\boldsymbol{x}, y_{i} ight), i=1, \ldots, n ight\}\) can be fitted via a tree with zero training loss.
-
For the breast cancer data in Section 7.8, investigate and discuss whether accuracy is the relevant metric to use or if other metrics discussed in Section 7.2 are more appropriate.
-
Repeat Exercise 16 with the original MNIST data set. Use the first 60,000 rows as the train set and the remaining 10,000 rows as the test set. The original data set can be obtained using the...
Study smarter with the SolutionInn App