Ikea Labs is evaluating its Dermex division, an investment center. The division has a $75,000 controllable margin and $510,000 of sales. How much will Ikea's average operating assets be when its return on investment is 12%? a. $625,000 b. $540,000 c. $690,000 d. $750,000
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IKEA labs is evaluating it's Dermex division investment centre.
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- Can you help me understand how to find the solutionIno Pharmaceuticals is evaluating its Vioxx division, an investment center. The division has a $68,000 controllable margin and $450,000 of sales. How much will Ino's average operating assets be when its return on investment is 10%? Answer this with correct solutionGolden Goodness (GG) has an investment center that had the following data: Operating Income $28,000 Sales $350,000 Invested assets $175,000 PMB has set a minimum acceptable rate of return at 14%. Using the information, answer the following questions. You must include what type of number it is (%, $, etc.) Part A: What is the profit margin? Part B: What is the investment turnover? Part C: What is the return on investment? Part D: What is the residual income? Part E: Explain each of the calculations you just performed (a-d).
- Ino Pharmaceuticals is evaluating its Vioxx division, an investment center. The division has a $68,000 controllable margin and $450,000 of sales. How much will Ino's average operating assets be when its return on investment is 10%?Golden Goodness (GG) has an investment center that had the following data: Operating Income $28,000 Sales $350,000 Invested assets $175,000 PMB has set a minimum acceptable rate of return at 14%. Using the information, answer the following questions. You must include what type of number it is (%, $, etc.) What is the profit margin? What is the investment turnover? What is the return on investment?Solve this financial accounting problem
- Golden Goodness (GG) has an investment center that had the following data: Operating Income $28,000 Sales $350,000 Invested assets $175,000 PMB has set a minimum acceptable rate of return at 14%. Using the information, answer the following questions. You must include what type of number it is (%, $, etc.) Part A: What is the residual income? Part B: Show calcualtions on how you got answerHow much21. The Caffeine Coffee Company uses the modified internal rate of return. The firm has a cost of capital of 11 percent. The project being analyzed is as follows ($26,000 investment): n Year 1 2. 3.. Cash Flow $12,000 11,000 9,000 a. What is the modified internal rate of return? page 405 b. Assume the traditional internal rate of return on the investment is 17.5 percent. Explain why your answer in part a would be lower.
- Superior Dlvision of the Monroe Company has an opportunity to invest in a new project. The project will yield an incremental operating Income of $73,700 on average invested assets of $$907,000. Superior Division currently has operating income of $432,000 on average Invested assets of $4,332,000. Monroe Company has a 7.7% hurdle rate for new projects. a. What is Superior Division's ROI before making an investment in the project? (Round your answer to 2 decimal places.) Retum on Investment b. What is Superior Division's residual income before making an investment in the project? Residual Income c. What is Superior Division's ROI after making the investment in the project? (Round your answer to 2 decimal places.) Retum on InvestmentAns.Innovation Company is thinking about marketing a new software product. Upfront costs to market and develop the product are $4.97 million. The product is expected to generate profits of $1.15 million per year for 10 years. The company will have to provide product support expected to cost $95,000 per year in perpetuity. Assume all profits and expenses occur at the end of the year. a. What is the NPV of this investment if the cost of capital is 6.1%? Should the firm undertake the project? Repeat the analysis for discount rates of 1.2% and 16.5%, respectively. b. What is the IRR of this investment opportunity? c. What does the IRR rule indicate about this investment?