Commodore Entertainment has four profitable business segments, described as follows: • Media Networks: Television and radio • Parks and Resorts: Resorts, including Commodore land • Studio Entertainment: Motion pictures, musical recordings, and stage plays • Consumer Products: Character merchandising, Commodore stores, books, and magazines Commodore Entertainment recently reported sector income from operations, revenue, and invested assets as follows: Income from Operations Revenue Invested Assets Media Networks $146,640 $624,000 $780,000 Parks and Resorts 41,756 343,200 572,000 Studio Entertainment 13,392 260,400 372,000 Consumer Products 94,163 324,700 191,000 a. Use the DuPont formula to determine the return on investment for the four Commodore Entertainment sectors. Round Profit Margin and ROI to one decimal place and Investment Turnover to two decimal places. Profit Margin Investment Turnover ROI Media Networks fill in the blank 1 % fill in the blank 2 fill in the blank 3 % Parks and Resorts fill in the blank 4 % fill in the blank 5 fill in the blank 6 % Studio Entertainment fill in the blank 7 % fill in the blank 8 fill in the blank 9 % Consumer Products fill in the blank 10 % fill in the blank 11 fill in the blank 12 % b. How do the four sectors differ in their profit margin, investment turnover, and return on investment? has the highest profit margin, while has the lowest profit margin. has the highest return on investment, while has the lowest return on investment.

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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Commodore Entertainment has four profitable business segments, described as follows:

• Media Networks: Television and radio
• Parks and Resorts: Resorts, including Commodore land
• Studio Entertainment: Motion pictures, musical recordings, and stage plays
• Consumer Products: Character merchandising, Commodore stores, books, and magazines

Commodore Entertainment recently reported sector income from operations, revenue, and invested assets as follows:

	Income from Operations	Revenue	Invested Assets
Media Networks	$146,640		$624,000	$780,000
Parks and Resorts	41,756		343,200	572,000
Studio Entertainment	13,392		260,400	372,000
Consumer Products	94,163		324,700	191,000

a. Use the DuPont formula to determine the return on investment for the four Commodore Entertainment sectors. Round Profit Margin and ROI to one decimal place and Investment Turnover to two decimal places.

	Profit Margin	Investment Turnover	ROI
Media Networks	fill in the blank 1 %	fill in the blank 2	fill in the blank 3 %
Parks and Resorts	fill in the blank 4 %	fill in the blank 5	fill in the blank 6 %
Studio Entertainment	fill in the blank 7 %	fill in the blank 8	fill in the blank 9 %
Consumer Products	fill in the blank 10 %	fill in the blank 11	fill in the blank 12 %

b. How do the four sectors differ in their profit margin, investment turnover, and return on investment?

has the highest profit margin, while

has the lowest profit margin.

has the highest return on investment, while

has the lowest return on investment.

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