1 Adams Corporation evaluates divisional managers based on ROI. Operating results for the company's Northern Division for last year are given below: Sales 27,000,000 Variable expenses Contribution margin 16,200,000 10,800,000 7. Fixed expenses 8,805,000 Net operating income 1.995.000 Lo Average divisional operating assets 9,500,000 %24 %24

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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USE FORMULA TO ANSWER THE QUESTION FOR EXAMPLE =B1+B2 

THAN GIVE THE ASWER 

32

 

SKIP FIRST TWO 

I NEED 25 - 33

PLEASE SHOW ME FORMULA.

 

D
E
F
1 Adams Corporation evaluates divisional managers based on ROI. Operating results for the
2 company's Northern Division for last year are given below:
3
4
Sales
27,000,000
15
Variable expenses
16,200,000
6
Contribution margin
10,800,000
Fixed expenses
8,805,000
Net operating income
1.995.000
10
Average divisional operating assets
9.500.000
11
12 The Northern Division has an opportunity to add a new product line at the beginning of the year as follows:
13
14
Average required investment
2,500,000
15
Net operating income
400,000
16
17 Adams Corporation's minimum acceptable rate of return
15%
18
19 Assuming the company accepts all projects that meet or exceed the minimum rate of return, compute the following:
20
21 Northern Division ROI for last year
22
23 Northern Division ROI if new product line is added
24
Sheet1
+)
READY
100%
Transcribed Image Text:D E F 1 Adams Corporation evaluates divisional managers based on ROI. Operating results for the 2 company's Northern Division for last year are given below: 3 4 Sales 27,000,000 15 Variable expenses 16,200,000 6 Contribution margin 10,800,000 Fixed expenses 8,805,000 Net operating income 1.995.000 10 Average divisional operating assets 9.500.000 11 12 The Northern Division has an opportunity to add a new product line at the beginning of the year as follows: 13 14 Average required investment 2,500,000 15 Net operating income 400,000 16 17 Adams Corporation's minimum acceptable rate of return 15% 18 19 Assuming the company accepts all projects that meet or exceed the minimum rate of return, compute the following: 20 21 Northern Division ROI for last year 22 23 Northern Division ROI if new product line is added 24 Sheet1 +) READY 100%
E21
A
B
D
E
14
Average required investment
Net operating income
2,500,000
15
400,000
16
17 Adams Corporation's minimum acceptable rate of return
15%
18
19 Assuming the company accepts all projects that meet or exceed the minimum rate of return, compute the following:
20
21 Northern Division ROI for last year
22
23 Northern Division ROI if new product line is added
24
25 Write an IF statement to determine whether the Northern Division
26 manager will ACCEPT or REJECT the new product line based on ROI.
27
28 Northern Division residual income for last year
29
30 Northern Division residual income if the new product line is added
31
32 Write an IF statement to determine whether the Northern Division manager
33 will ACCEPT or REJECT the new product line based on residual income
34
35
36
37
Sheet1
...
READY
100%
Transcribed Image Text:E21 A B D E 14 Average required investment Net operating income 2,500,000 15 400,000 16 17 Adams Corporation's minimum acceptable rate of return 15% 18 19 Assuming the company accepts all projects that meet or exceed the minimum rate of return, compute the following: 20 21 Northern Division ROI for last year 22 23 Northern Division ROI if new product line is added 24 25 Write an IF statement to determine whether the Northern Division 26 manager will ACCEPT or REJECT the new product line based on ROI. 27 28 Northern Division residual income for last year 29 30 Northern Division residual income if the new product line is added 31 32 Write an IF statement to determine whether the Northern Division manager 33 will ACCEPT or REJECT the new product line based on residual income 34 35 36 37 Sheet1 ... READY 100%
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