The management of International Heal Medical Company is evaluating the performance of its three (3) divisions. The
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Question:
The management of International Heal Medical Company is evaluating the performance of its three (3) divisions. The Booboo Division had an operating profit of ₱24,950 and on average used assets with a book value of ₱311,900. The Splint Division had an operating profit of ₱17,500 and used average assets of ₱177,950. The Intensive Care Division had an operating profit of ₱28,500 and average assets of ₱475,000. The company is planning to award the Intensive Care Division relying on its high operating profit. Should the management continue with this decision? Justify your answer.
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