Betsy Union is the Crane Company manager and her performance is evaluated by executive management based on Division ROI. The current controllable margin for Crane Company is $58000. Its current operating assets total $220000. The division is considering purchasing equipment for $40000 that will increase contribution margin by an estimated $13000, with annual depreciation of $13000. If the equipment is purchased, how will the return on investment for the division change? O It will remain unchanged O A decrease of 0.9% O An increase of 0.9% O A decrease of 4.1%

Betsy Union is the Crane Company manager and her performance is evaluated by executive management based on Division ROI. The current controllable margin for Crane Company is $58000. Its current operating assets total $220000. The division is considering purchasing equipment for $40000 that will increase contribution margin by an estimated $13000, with annual depreciation of $13000. If the equipment is purchased, how will the return on investment for the division change? O It will remain unchanged O A decrease of 0.9% O An increase of 0.9% O A decrease of 4.1%

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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