### Required Information **[The following information applies to the questions displayed below.]** **Westerville Company** reported the following results from last year's operations: - **Sales**: $2,300,000 - **Variable expenses**: $670,000 - **Contribution margin**: $1,630,000 - **Fixed expenses**: $1,170,000 - **Net operating income**: $460,000 - **Average operating assets**: $1,437,500 At the beginning of this year, the company has a $287,500 investment opportunity with the following cost and revenue characteristics: - **Sales**: $460,000 - **Contribution margin ratio**: 50% of sales - **Fixed expenses**: $161,000 The company’s minimum required rate of return is 15%. **Required:** 1. **What is last year's margin?** **Margin**: ___ %
### Required Information **[The following information applies to the questions displayed below.]** **Westerville Company** reported the following results from last year's operations: - **Sales**: $2,300,000 - **Variable expenses**: $670,000 - **Contribution margin**: $1,630,000 - **Fixed expenses**: $1,170,000 - **Net operating income**: $460,000 - **Average operating assets**: $1,437,500 At the beginning of this year, the company has a $287,500 investment opportunity with the following cost and revenue characteristics: - **Sales**: $460,000 - **Contribution margin ratio**: 50% of sales - **Fixed expenses**: $161,000 The company’s minimum required rate of return is 15%. **Required:** 1. **What is last year's margin?** **Margin**: ___ %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![### Required Information
**[The following information applies to the questions displayed below.]**
**Westerville Company** reported the following results from last year's operations:
- **Sales**: $2,300,000
- **Variable expenses**: $670,000
- **Contribution margin**: $1,630,000
- **Fixed expenses**: $1,170,000
- **Net operating income**: $460,000
- **Average operating assets**: $1,437,500
At the beginning of this year, the company has a $287,500 investment opportunity with the following cost and revenue characteristics:
- **Sales**: $460,000
- **Contribution margin ratio**: 50% of sales
- **Fixed expenses**: $161,000
The company’s minimum required rate of return is 15%.
**Required:**
1. **What is last year's margin?**
**Margin**: ___ %](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Febfcfc0b-9f32-4e16-9143-aece98b8dc65%2Fb82dd81b-05ee-405f-b0d6-55b3a7e37293%2Fva23pq.jpeg&w=3840&q=75)
Transcribed Image Text:### Required Information
**[The following information applies to the questions displayed below.]**
**Westerville Company** reported the following results from last year's operations:
- **Sales**: $2,300,000
- **Variable expenses**: $670,000
- **Contribution margin**: $1,630,000
- **Fixed expenses**: $1,170,000
- **Net operating income**: $460,000
- **Average operating assets**: $1,437,500
At the beginning of this year, the company has a $287,500 investment opportunity with the following cost and revenue characteristics:
- **Sales**: $460,000
- **Contribution margin ratio**: 50% of sales
- **Fixed expenses**: $161,000
The company’s minimum required rate of return is 15%.
**Required:**
1. **What is last year's margin?**
**Margin**: ___ %
Expert Solution

Step 1
Margin = operatin income/ net sales
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