Exercise 9-8A Return on investment Mitchell Company calculated its return on investment as 13 percent. Sales are now $270,000, and the amount of total operating assets is $450,000. Required a. If expenses are reduced by $27,000 and sales remain unchanged, what return on investment will result? b. If both sales and expenses cannot be changed, what change in the amount of operating assets is required to achieve the same result?

Exercise 9-8A Return on investment Mitchell Company calculated its return on investment as 13 percent. Sales are now $270,000, and the amount of total operating assets is $450,000. Required a. If expenses are reduced by $27,000 and sales remain unchanged, what return on investment will result? b. If both sales and expenses cannot be changed, what change in the amount of operating assets is required to achieve the same result?

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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