Exercise 14-29 (Algo) Compute RI and ROI (LO 14-2, 3)The Custodial Division of Clark's Corporate Services (CCS) has assets of $1.2 million. During the past year, the division had profits of$240,000. CCS has a cost of capital of 7.5 percent. Ignore taxes.Required:a. Compute the divisional ROI for the Custodial Division.b. Compute the divisional RI for the Custodial Division.Complete this question by entering your answers in the tabs below.Required A Required BCompute the divisional RI for the Custodial Division.Note: Enter your answer in dollars, not in millions.Divisional RI< Required ARequired B > Exercise 14-29 (Algo) Compute RI and ROI (LO 14-2, 3)The Custodial Division of Clark's Corporate Services (CCS) has assets of $1.2 million. During the past year, the division had profits of$240,000. CCS has a cost of capital of 7.5 percent. Ignore taxes.Required:a. Compute the divisional ROI for the Custodial Division.b. Compute the divisional RI for the Custodial Division.Complete this question by entering your answers in the tabs below.Required A Required BCompute the divisional ROI for the Custodial Division.Divisional ROI%< Required ARequired B >

Exercise 14-29 (Algo) Compute RI and ROI (LO 14-2, 3) The Custodial Division of Clark's Corporate Services (CCS) has assets of $1.2 million. During the past year, the division had profits of $240,000. CCS has a cost of capital of 7.5 percent. Ignore taxes. Required: a. Compute the divisional ROI for the Custodial Division. b. Compute the divisional RI for the Custodial Division. Complete this question by entering your answers in the tabs below. Required A Required B Compute the divisional ROI for the Custodial Division. Divisional ROI % < Required A Required B >

Exercise 14-29 (Algo) Compute RI and ROI (LO 14-2, 3) The Custodial Division of Clark's Corporate Services (CCS) has assets of $1.2 million. During the past year, the division had profits of $240,000. CCS has a cost of capital of 7.5 percent. Ignore taxes. Required: a. Compute the divisional ROI for the Custodial Division. b. Compute the divisional RI for the Custodial Division. Complete this question by entering your answers in the tabs below. Required A Required B Compute the divisional ROI for the Custodial Division. Divisional ROI % < Required A Required B >

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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a. Compute ROI for Division B.b. Compute residual income for Division A.c. Division B could increase its profit by $80,000 by increasing its investment by $300,000. Computeits total residual income. d. Division A could increase its return on sales by one percentage point, while keeping the same totalsales. Compute its ROI.e. Division A could increase its sales so that its asset turnover increased by one time, while holdingtotal assets constant. Compute its ROI.
6. Compute the residual income of CBS.7. Compute the EVA of CBS
Burwell Manufacturing is organized into two divisions (Agriculture and Mining) and a corporate headquarters. The financial group of the corporate staff prepared financial operating plans (budgets) for the two divisions for the upcoming year (year 1). Selected information from the plans is as follows: Employees (full-time equivalent, or FTE) Revenues ($000) Direct division costs ($000) Operating profit before allocation ($000) Agriculture 23 $ 6,360 3,400 $ 2,960 Corporate overhead costs are expected to be $4.2 million in year 1. Of the $4.2 million, $1.95 million is fixed and the remainder is variable. Two-thirds of the variable cost is variable with respect to revenue. The other third is variable with respect to the number of full-time equivalent (FTE) employees. Division managers are evaluated and compensated in part on division operating profit (including any allocated corporate costs) relative to the budget. Corporate overhead at Burwell is allocated based on relative revenues to…
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1. Compute the residual income of MCC. 2. Compute the EVA of MCC.
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7. Jordan Company has two divisions, which reported the following results for the most recent year. Division I Division II Income ₱ 02,700,000 ₱ 00,600,000 Average invested capital ₱ 18,000,000 ₱ 03,000,000 ROI 15% 20% Imputed interest rate = 10% Under residual income, which division is considered to have a better performance? Show solution Group of answer choices Neither Division I nor II Cannot be determined Division I Division II
Please answer questions No. 1 to 6 of Jay Arr Company. Please provide a complete solution. Thank You
Exercise 14-27 (Algo) Computing Divisional Income: Incomplete Information and Financial Ratios (LO 14- 1) The following partial financial information (in thousands of dollars) is available for Thole, Incorporated: Corporate overhead costs at Thole are allocated to divisions based on relative sales. Required: a. Complete the income statements for both divisions and the corporation as a whole. Note: Enter your answers in thousands. Enter all values as positive value. Round your answers to 1 decimal place. Sales Cost of sales Gross margin Selling, General and Administrative Allocated corporate costs Operating income Tax expense (@20%) After-tax income Gross margin percentage Operating margin Profit margin Pacific 20.0 (Thousands of Dollars) Southern 40.00% 20.00 % 16.00 % 50.00 % 36.00 % 28.80 % Total 100.0 $1,016.8 48.00 % 32.80 % 26.24 %