Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets $ 1,300,000 440,000 860,000 600,000 $ 260,000 $ 812,500 At the beginning of this year, the company has a $162,500 investment opportunity with the following cost and revenue characteristics: Sales $ 260,000 Contribution margin ratio 80% of sales $ 182,000 Fixed expenses The company's minimum required rate of return is 15%. 9. If the company pursues the investment opportunity and otherwise performs the same as last year, what ROI will it earn this year? Note: Round your percentage answer to 1 decimal place (i.e., 0.1234 should be considered as 12.3%.) ROI % Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets $ 1,300,000 440,000 860,000 600,000 $ 260,000 $ 812,500 At the beginning of this year, the company has a $162,500 investment opportunity with the following cost and revenue characteristics: Sales $ 260,000 Contribution margin ratio 80% of sales $ 182,000 Fixed expenses The company's minimum required rate of return is 15%. 9. If the company pursues the investment opportunity and otherwise performs the same as last year, what ROI will it earn this year? Note: Round your percentage answer to 1 decimal place (i.e., 0.1234 should be considered as 12.3%.) ROI %
Expert Answer:
Answer rating: 100% (QA)
Heres the breakdown Calculate Incremental Income from the Investment ... View the full answer
Posted Date:
Students also viewed these accounting questions
-
An investor is considering the purchase of an existing suburban office building approximately five years old. The building, when constructed, was estimated to have an economic life of 5 0 years, and...
-
Company Information & Summary of Significant Account Policies Macon Machines Company began operations on November 1, 2024. The main operating goal of the company is to sell high end robots. Customers...
-
We turn once more to the TM M Its transition diagram is reproduced below: 91 M-R X-R Greject 0-0.R x-R 92 U-R u-R accept U-R 95 0-x,R U-L 0-R X-R 93 94 Its transitions in accepting the string 0 are...
-
The 2019 catalog that Gigantic State University (GSU) sent to prospective students described a merit-based scholarship called the Eagle Scholarship. The catalog stated that GSU offers the Eagle...
-
Amazon books (www.amazon.com) summarizes reader reviews of the books it sells. Persons who want to review a book can submit a review online; Amazon then reports the average rating from all reader...
-
A piston-cylinder device contains 0.85 kg of refrigerant- 134a at 210oC. The piston that is free to move has a mass of 12 kg and a diameter of 25 cm. The local atmospheric pressure is 88 kPa. Now,...
-
Why is a yield curve showing higher long-term interest rates than short-term rates (rising curve) called a normal curve?
-
The following data represent tonnes of wheat harvested each year (1894-1925) from Plot 19 at the Rothamsted Agricultural Experiment Stations, England. (a) Multiply each data value by 100 to "clear"...
-
Question 6 Not yet answered Marked out of 5.00 Calculate the changes in the following financials after a 20% Stock Dividend was distributed to ABC's shareholders. Assume ABC's market price per share...
-
. Question 7 0/1 pt 9 3 49 @ Details Diego and Santos plan to purchase a home for $362,000. They will pay 20% down and finance the remainder for 30 years at the APR of 5.2%, compounded monthly. a)...
-
Assume that you have borrowed $3,000 for 3 years and you have an annual interest rate of 11% (APR). Assume that the payments are made annually . What is the annual interest expense for the borrower,...
-
what is reward to variability ratio? is it sharpe ratio?
-
Initial dislocation density of a FCC single crystal is 10 m/m'. The yield strength of the crystal is 3.675 MPa when the tensile load applied along the [0 0 1] direction. (a) Find out the critical...
-
Explore the utilization of advanced remote sensing technologies, such as LiDAR (Light Detection and Ranging) and satellite imagery, in civil engineering applications such as land surveying, terrain...
-
2. List and describe the different EXIM Bank International Trade Working Capital and Export Credit Insurance products including uses, maximum coverage and limitations . 3. Briefly summarize the...
-
Pages were randomly selected from one book each from authors A, B, and C. The accompanying table shows the ease-of-reading scores for those pages. Use a 0.05 significance level to test the claim that...
-
Using the information in P11-2B, compute the overhead controllable variance and the overhead volume variance. Data From Problem 11-2B: Huang Company uses a standard cost accounting system to account...
-
Kayjay Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (8 pounds at \($2.50\) per pound) \($20.00\) Direct labor (3...
-
Kimiko Company's standard labor cost per unit of output is $ 1 8 (2 hours X \($9.00\) per hour). During August, the company incurs 1,850 hours of direct labor at an hourly cost of \($9.60\) per hour...
-
The standard cost of Product B manufactured by Lopez Company includes three units of direct materials at $5.00 per unit. During June, 30,000 units of direct materials are purchased at a cost of $4.80...
Study smarter with the SolutionInn App