Hewlett-Packard Company reports that its “organizational structure is based on a number of factors that management uses to evaluate, view and run its business operations.” In its disclosures of segment information, there are seven segments—Personal Systems, Printing, Enterprise Group, Enterprise Services, Software, HP Financial Services, and Corporate Investments. The company provides the following information about these business segments: ($ millions) Year 2 Year 1 Total net revenue: Personal Systems $39,574 $40,741 Printing 25,783 25,764 Enterprise Group 35,954 35,529 Enterprise Services 22,241 20,356 Software 3,217 2,729 HP Financial Services 3,596 3,047 Corporate Investments 302 24 Earnings from operations: Personal Systems $2,750 $2,032 Printing 4,373 4,412 Enterprise Group 5,549 5,661 Enterprise Services 3,426 2,825 Software 1,098 782 HP Financial Services 748 281 Corporate Investments (199) (316) Total assets: Personal Systems $15,781 $16,548 Printing 11,939 12,514 Enterprise Group 40,614 41,989 Enterprise Services 17,539 18,262 Software 21,028 9,979 HP Financial Services 13,543 12,123 Corporate Investments 34 105 Calculate the Year 2 Return on Capital Employed for the following segments: Personal Systems, Printing, and Corporate Investments. (Base the calculation on total assets instead of net operating assets in the denominator—HP does not disclose operating liabilities by segment.)(Round your answer to one decimal place.)

Managerial Accounting

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ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 1MAD

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Hewlett-Packard Company reports that its “organizational structure is based on a number of factors that management uses to evaluate, view and run its business operations.” In its disclosures of segment information, there are seven segments—Personal Systems, Printing, Enterprise Group, Enterprise Services, Software, HP Financial Services, and Corporate Investments. The company provides the following information about these business segments:

($ millions)	Year 2	Year 1
Total net revenue:
Personal Systems	$39,574	$40,741
Printing	25,783	25,764
Enterprise Group	35,954	35,529
Enterprise Services	22,241	20,356
Software	3,217	2,729
HP Financial Services	3,596	3,047
Corporate Investments	302	24
Earnings from operations:
Personal Systems	$2,750	$2,032
Printing	4,373	4,412
Enterprise Group	5,549	5,661
Enterprise Services	3,426	2,825
Software	1,098	782
HP Financial Services	748	281
Corporate Investments	(199)	(316)
Total assets:
Personal Systems	$15,781	$16,548
Printing	11,939	12,514
Enterprise Group	40,614	41,989
Enterprise Services	17,539	18,262
Software	21,028	9,979
HP Financial Services	13,543	12,123
Corporate Investments	34	105

Calculate the Year 2 Return on Capital Employed for the following segments: Personal Systems, Printing, and Corporate Investments. (Base the calculation on total assets instead of net operating assets in the denominator—HP does not disclose operating liabilities by segment.)
(Round your answer to one decimal place.)

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