The Sports Equipment Division of Brandon McCarthy Company is operated as a profit center. Sales for the division were budgeted for 2010 at $900,000. The only variable costs budgeted for the division were cost of goods sold ($440,000) and selling and administrative ($60,000). Fixed costs were budgeted at $100,000 for cost of goods sold, $90,000 for selling and administrative and $70,000 for noncontrollable fixed costs. Actual results for these items were:

Sales .................$880,000

Cost of goods sold

Variable ................ 409,000

Fixed ................105,000

Selling and administrative

Variable .................61,000

Fixed ..................67,000

Noncontrollable fixed ...........80,000

Instructions

(a) Prepare a responsibility report for the Sports Equipment Division for 2010.

(b) Assume, instead, the division is an investment center, and average operating assets were $1,000,000. Compute ROI.