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Elway Company provided the following income statement for the last year: Sales $1,040,000,000 Less: Variable expenses 700,250,000 Contribution margin $ 339,750,000 Less: Fixed expenses 183,750,000 Operating income $ 156,000,000 At the beginning of last year, Elway had $28,300,000 in operating assets. At the end of the year, Elway had $23,700,000 in operating assets. Required: 1. Compute average operating assets. $_ 2. Compute the margin (as a percent) and turnover ratios for last year. Margin Turnover 3. Compute ROI as a percent. % 4. ROI measures a company's ability to generate relative to its investment in %

Elway Company provided the following income statement for the last year: Sales $1,040,000,000 Less: Variable expenses 700,250,000 Contribution margin $ 339,750,000 Less: Fixed expenses 183,750,000 Operating income $ 156,000,000 At the beginning of last year, Elway had $28,300,000 in operating assets. At the end of the year, Elway had $23,700,000 in operating assets. Required: 1. Compute average operating assets. $_ 2. Compute the margin (as a percent) and turnover ratios for last year. Margin Turnover 3. Compute ROI as a percent. % 4. ROI measures a company's ability to generate relative to its investment in %

FINANCIAL ACCOUNTING
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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Elway Company provided the following income statement for the last year: Sales $1,040,000,000 Less: Variable expenses 700,250,000 Contribution margin $ 339,750,000 Less: Fixed expenses 183,750,000 Operating income $ 156,000,000 At the beginning of last year, Elway had $28,300,000 in operating assets. At the end of the year, Elway had $23,700,000 in operating assets. Required: 1. Compute average operating assets. $_ 2. Compute the margin (as a percent) and turnover ratios for last year. Margin Turnover 3. Compute ROI as a percent. % 4. ROI measures a company's ability to generate relative to its investment in %
Transcribed Image Text:Elway Company provided the following income statement for the last year: Sales $1,040,000,000 Less: Variable expenses 700,250,000 Contribution margin $ 339,750,000 Less: Fixed expenses 183,750,000 Operating income $ 156,000,000 At the beginning of last year, Elway had $28,300,000 in operating assets. At the end of the year, Elway had $23,700,000 in operating assets. Required: 1. Compute average operating assets. $_ 2. Compute the margin (as a percent) and turnover ratios for last year. Margin Turnover 3. Compute ROI as a percent. % 4. ROI measures a company's ability to generate relative to its investment in %
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