Capital Investments has two divisions. Each division's required rate of return is 10%. Planned operating results for 2020 are as follows: (Click the icon to view the planned operating results.) Read the requirements. Requirement a. What is the current ROI for each division? Begin by selecting the formula to calculate ROI, then compute the ROI for each division. Division A Division B + + + = = ROI % %

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter12: Balanced Scorecard And Other Performance Measures
Section: Chapter Questions
Problem 15MC: Calculate the ROI for Gardner Chemical given the following information: A. 25% B. 24% C. 60% D. 40%
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Data table
Division
A
B
Operating income
$ 12,350,000
$ 10,640,000
Investment
$ 95,000,000
$ 56,000,000
X
Transcribed Image Text:Data table Division A B Operating income $ 12,350,000 $ 10,640,000 Investment $ 95,000,000 $ 56,000,000 X
Capital Investments has two divisions. Each division's required rate of return is 10%. Planned operating results for 2020 are as follows:
(Click the icon to view the planned operating results.)
Read the requirements.
Requirement a. What is the current ROI for each division?
Begin by selecting the formula to calculate ROI, then compute the ROI for each division.
Division A
Division B
+
+
||
=
||
ROI
%
%
Transcribed Image Text:Capital Investments has two divisions. Each division's required rate of return is 10%. Planned operating results for 2020 are as follows: (Click the icon to view the planned operating results.) Read the requirements. Requirement a. What is the current ROI for each division? Begin by selecting the formula to calculate ROI, then compute the ROI for each division. Division A Division B + + || = || ROI % %
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Capital Investments has two divisions. Each division's required rate of return is 10%. Planned operating results for 2020 are as follows:
(Click the icon to view the planned operating results.)
Read the requirements.
Requirement a. What is the current ROI for each division?
Begin by selecting the formula to calculate ROI, then compute the ROI for each division.
Measure of income
+ Measure of investment =
12,350,000
95,000,000
56,000,000
10,640,000
Division A
Division B
Division A
Division B
Requirement b. What is the current residual income for each division?
Begin by selecting the formula to calculate the residual income (RI), then compute the RI for each division.
X
ROI
X
13 %
19 %
%
%
)=
RI
Transcribed Image Text:Capital Investments has two divisions. Each division's required rate of return is 10%. Planned operating results for 2020 are as follows: (Click the icon to view the planned operating results.) Read the requirements. Requirement a. What is the current ROI for each division? Begin by selecting the formula to calculate ROI, then compute the ROI for each division. Measure of income + Measure of investment = 12,350,000 95,000,000 56,000,000 10,640,000 Division A Division B Division A Division B Requirement b. What is the current residual income for each division? Begin by selecting the formula to calculate the residual income (RI), then compute the RI for each division. X ROI X 13 % 19 % % % )= RI
Data table
Division
A
B
Operating income
$ 12,350,000
$ 10,640,000
Investment
$ 95,000,000
$ 56,000,000
X
Transcribed Image Text:Data table Division A B Operating income $ 12,350,000 $ 10,640,000 Investment $ 95,000,000 $ 56,000,000 X
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