ected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below:
Q: Compute the residual income for each division. North Division West Division South Division SA $…
A: RETURN ON INVESTMENTReturn on investment is one of the profitability ratios which shows how much…
Q: Required information Use the following information for the Problems below: The following data…
A: Ratio analysis s helps to analyze the financial statements of the company. Management can make…
Q: Division Queensland $928,000 $ 580,000 $ 74,240 $ 243,000 Required 1 Required 2 New South Wales $…
A: MARGIN Margin is the Ratio Between Net Operating Income & Net Sales.Formula = (Net operating…
Q: Division A $ 12,280,000 $ 3,070,000 $ 601,720 10.00% Division B $35,350,000 $ 7,070,000 $ 600,950…
A: Return on investment (ROI) is a performance statistic used to evaluate the efficiency or…
Q: Meiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and…
A: Net operating income : Net operating income is commonly used concept which can be used by companies…
Q: Ryan Division has the following results for the year: Revenues $470,000 Net…
A: Residual Income: Residual income is the income that a company earns after paying off all the…
Q: Required: 1. Compute the rate of return for each division using the return on investment (ROI)…
A: Introduction:- The following formula used as follows under:- 1)Margin =(Net operating margin/Sales)…
Q: Division A's asset turnover (AT) is (rounded to two decimal places):
A: Given that , Sales = $490000 Average investment = $416500 Operating income = $ 83300
Q: ROI and Residual Income: Basic Computations Watkins Associated Industries is a highly diversified…
A: Lets understand the basics. Return on investment is a ratio which shows how much net operating…
Q: For its three investment centers, Gerrard Company accumulates the following data: I II…
A: Return on investment is compute by dividing the controllable margin with the average operating…
Q: Meiji Isetan Corp. of Japan has two regional divisions with headquarters in Osaka and Yokohama.…
A: Return on Investment (ROI) refers to the return that the investors receive if invested in a certain…
Q: The following data are available for two divisions of Solomons Company. North Division South…
A: Answer 1) ROI = Operating profit / investmentsNorth Devision = (10,515,000/49,000,000) x 100 =…
Q: Meiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and…
A: Margin :— It is calculated by dividing net operating income by sales. Turnover :— It is…
Q: Meiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and…
A: Return on investment (ROI)=Net Operating IncomeAverage Operating Assets×100 Residual Income=Net…
Q: The following data pertain to three divisions of Nevada Aggregates, Incorporated. The company's…
A: ROI means return on investment.. It is the percentage return earned by the entity on the operating…
Q: Warren Company has a hurdle rate of 11.2%. a. Calculate the return on investment for each division.…
A: a)Calculation of return on investments as follows under:-
Q: The sales, income from operations, and invested assets for each division of Jackson Corporation are…
A: The ratio analysis helps to analyze the financial statements of the business on the basis of various…
Q: Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X Y Z…
A: Operating income for division Y (O) = $108200 Investment for division Y (I) = $764100
Q: Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama.…
A: RETURN ON INVESTMENTReturn on investment is one of the profitability ratios which shows how much…
Q: Meiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and…
A: Margin :— It is calculated by dividing net operating income by sales. Turnover :— It is…
Q: Alyeska Services Company, a division of a major oil company, provides various services to the…
A: Margin :— It is calculated by dividing net operating income by net sales. Turnover :— It is…
Q: Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below:…
A: FIXED ASSETS TURN OVER RATIOFixed Assets Turnover ratio indicates the investment in Fixed Assets has…
Q: Use the following information for the Problems below: The following data pertain to three divisions…
A: We can use the following formula to find the missing values of the table.Formula used for…
Q: Selected operating data for two divisions of Outback Brewing, Limited, of Australia are given below:…
A: Margin is calculated by dividing net operating income by sales. Turnover is calculated by dividing…
Q: The sales, income from operations, and invested assets for each division of Grosbeak Company are as…
A: RATIO ANALYSIS- IT IS A QUANTITATIVE METHOD OF GAINING INSIGHT IN TO COMPANYS LIQUIDITY,OPERATIONAL…
Q: operating assets ting income required rate of return. Division A $ 12,600,000 $ 3,150,000 $ 516,600…
A: Return on investment (ROI) is a performance statistic used to evaluate the efficiency or…
Q: Use the following information for the Problems below: The following data pertain to three divisions…
A: ROI means return on investment. It is the percentage return earned by the entity on the operating…
Q: Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama.…
A: Return on investment is a measure to find out profit or loss on the investment. It measure the…
Q: Meiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and…
A: Return on investment = Net Operating income / Sales Residual income = Net Operating income - Average…
Q: elected sales and operating data for three divisions of different structural engineering firms are…
A: Solution : Return on investment is percentage return earned on average operating assets of the…
Q: The Western Division of Claremont Company had net operating income of $144,000 and average invested…
A: Return on investment :— It is calculated by dividing net operating income by average total operating…
Q: The condensed income statement for the Consumer Products Division of Tri-State Industries Inc. is as…
A:
Q: Selected sales and operating data for three divisions of different structural engineering firms are…
A: Margin :— It is the ratio of net operating income and sales. Turnover :— It is the ratio of sales…
Q: Megamart provides the following information on its two investment centers. Investment Center…
A: The answer is in the explanation section below.Explanation:Electronics Center:1. Income:…
Q: Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama.…
A: Return on investment- is measurement of performance evaluation on investments made where's residual…
Q: Return on investment is often expressed as follows: Controllable margin Average operating assets…
A: Ratios are very helpful in decision making process in the business. It makes use of financial…
Q: Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X Y Z…
A: Introduction:- The following formula used to calculate return on sales as follows under:- Return on…
Q: The following is partial information for Charleston Company’s most recent year of operation. It…
A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…
Q: Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama.…
A: ROI (Return on Investment) is a financial metric that assesses the effectiveness of an investment by…
Q: Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama.…
A: The Operating income is the difference between total revenue and total operating expense of the…
Q: Required information Use the following information for the Problems below: The following data…
A: ROI (Return on investment) helps in measuring the performance by evaluating the profit and…
Q: Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below:…
A: MARGIN Margin is the Ratio Between Net Operating Income & Net Sales. TURNOVER Turnover is…
Q: Selected sales and operating data for three divisions of different structural engineering firms are…
A: In order to determine the margin, the net operating income is required to be divided by the net…
Q: Selected operating data for two divisions of Outback Brewing, Ltd. of Australia are as follows:…
A: MARGIN Margin is the Ratio between Net Operating Income & Net Sales Revenue.Margin = (Net…
Q: Conner Manufacturing has two major divisions. Management wants to compare their relative…
A: Lets understand the basics.All the operating income earned over a required return on investment made…
Q: The Western Division of Claremont Company had net operating income of $148,000 and average invested…
A: Return on investment :— It is calculated by dividing net operating income by average total operating…
Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below:
Division | ||
---|---|---|
Queensland | New South Wales | |
Sales | $ 855,000 | $ 2,200,000 |
Average operating assets | $ 570,000 | $ 550,000 |
Net operating income | $ 44,460 | $ 48,400 |
Property, plant, and equipment (net) | $ 244,000 | $ 194,000 |
Required:
1. Compute the
2. Which divisional manager seems to be doing the better job?
Step by step
Solved in 2 steps with 1 images
- Meiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka Yokohama Sales $ 9,600,000 $ 26,000,000 Net operating income $ 672,000 $ 2,340,000 Average operating assets $ 3,200,000 $ 13,000,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 16%. Compute the residual income for each division. 3. Is Yokohama’s greater amount of residual income an indication that it is better managed?Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below: Sales Average operating assets Net operating income Property, plant, and equipment (net)) Queensland division New South Wales division Queensland Margin Division Required: 1. Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margin and turnover. 2. Which divisional manager seems to be doing the better job? % % Complete this question by entering your answers in the tabs below. $ 969,000 $ 510,000 Required 1 Required 2 Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margin and turnover. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Turnover $ 87,210 $ 267,000The following data are available for two divisions of Ryan Enterprises: Alpha Division Beta Division Division operating profit $ 7,360,000 $ 1,240,000 Division investment 32,160,000 3,160,000 The cost of capital for the company is 7 percent. Ignore taxes. Required: a-1. Calculate the ROI for both Alpha and Beta divisions. a-2. If Ryan measures performance using ROI, which division had the better performance? b-1. Calculate the EVA for both Alpha and Beta divisions. (The divisions have no current liabilities.) b-2. If Ryan measures performance using economic value added, which division had the better performance? c. Would your evaluation change if the company’s cost of capital was 10 percent, when evaluated by ROI? when evaluated by EVA?
- ROI and Residual Income A multinational corporation has a number of divisions, two of which are the North American Division and the Pacific Rim Division. Data on the two divisions are as follows: North American Pacific Rim Average operating assets $15,000,000 $6,700,000 Operating income 1,250,000 610,000 Minimum required return 7 % 7 % Round all rates of return to four significant digits. Required: 1. Compute residual income for each division. North American $ fill in the blank 1 Pacific Rim $ fill in the blank 2 By comparing residual income, is it possible to make a useful comparison of divisional performance? 2. Compute the residual rate of return by dividing the residual income by the average operating assets. Enter your answers as percentages, rounded to two decimal places. For example, the decimal value .03827 would be entered as "3.83" percent. North American fill in the blank 4 % Pacific Rim fill in the blank 5 % Is it possible now to…Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Sales Average operating assets Net operating income Minimum required rate of return Division A $6,300,000 $1,260,000 $ 340,200 20.00% Division B $10,300,000 $ 5,150,000 $ 968,200 18.80% Division C $9,400,000 $1,880,000 $ 249,100 17.00% Required: 1. Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. I Margin Turnover ROI Division A 5.40 % times % Division B % 2.00 times :% Division C % times % 2. Compute the residual income (loss) for each division. (Loss amounts should be indicated by a minus sign. Roui Division A Division B Division C Average operating assets Required rate of return % % % Required operating income Actual operating income Required operating income (above) Residual income (loss) 3. Assume that each division is presented with an investment opportunity that would y a. If performance is being…A company's division has sales of $2,610,000, income of $991,800, and average assets of $1,800,000. Compute the division's profit margin, return on investment, and investment turnover. Compute the Division's Profit Margin. Numerator: Denominator: Profit Margin Profit margin Compute the Division's Return on investment. Numerator: Denominator: Return on investment Return on investment Compute the Division's Investment Turnover. Numerator: Denominator: Investment Turnover %3D Investment turnover
- Selected sales and operating data for three divisions of different structural engineering firms are given below: Division C $ 25,450,000 $ 5,090,000 $636,250 12.50% Sales Average operating assets Net operating income Minimum required rate of return Division A $ 12,360,000 $ 3,090,000 $ 494,400 7.00% Required: 1. Compute each division's margin, turnover, and return on investment (ROI). 2. Compute each division's residual income (loss). 3. Assume each division is presented with an investment opportunity yielding a 8% rate of return. a. If performance is being measured by ROI, which division or divisions will accept the opportunity? b. If performance is being measured by residual income, which division or divisions will accept the opportunity? Division B $ 28,360,000 $ 7,090,000 $ 453,760 7.50% Complete this question by entering your answers in the tabs below. Division A Division B Division C Required 1 Required 2 Required 3A Required 3B Assume each division is presented with an…The Western Division of Claremont Company had net operating income of $154,000 and average invested assets of $557,000. Claremont has a required rate of return of 14.75 percent. Western has an opportunity to increase operating income by $48,000 with a $84,000 investment in assets. Compute Western Division's return on investment and residual income currently and if it undertakes the project. Note: Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%). Round your Residual Income (Loss) answers to the nearest whole dollar. Return on Investment (ROI) Residual Income (Loss) Current % Proposed ProjectMeiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka Yokohama Sales $ 9,800,000 $ 28,000,000 Net operating income $ 588,000 $ 2,240,000 Average operating assets $ 2,450,000 $ 14,000,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 14%. Compute the residual income for each division. 3. Is Yokohama’s greater amount of residual income an indication that it is better managed? Osaka Yokohama ROI % % Osaka Yokohama Residual income
- Kyle Corporation provides the following information for the Product Division and Service Division for the year. Product Division Service Division 420,000 $ 650,000 195,000 245,000 640,000 610,000 14.0% 14.0% Net sales Operating income Average total assets Target rate of return $ Requirement 1. Calculate the return on investment for each division. (Enter answers as a percent rounded to the nearest hundredth percent, X.XX%) The return on investment for the Product Division is The return on investment for the Service Division is Requirement 2. Which division has the highest ROI? % % Requirement 3. Calculate the residual income for each division. (Round answers to the nearest whole dollar.) The residual income for the Product Division is The residual income for the Service Division is Requirement 4. Which division has the highest residual income?Knowledge Check East Division of Blue Spruce Anchors provided the following information: Contribution margin Controllable margin Average operating assets Minimum rate of return Return on investment $890,000 $395,900 $2,140,000 Compute the return on investment and the residual income. (Round return on investment answer to two decimal places (e.g., 15.25%).) Residual income 9 % %Presented below is selected financial information for two divisions of Crane Brewing. Supply the missing information for the lettered items. Lager Lite Lager Contribution margin $500,000 $299,200 Controllable margin 199,920 (c) Average operating assets $ (a) $1,200,900 Minimum rate of return $ % (b) 14 % Return on investment Residual income 21 % $104,720 % (d) $204,153