Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.01 percent. Selected operating data for the three divisions follow: Peak View Grand 337,000 $ 223,000 $ 310,000 119,000 32,000 870,000 Sales revenue Cost of goods sold Miscellaneous operating expenses Average invested assets 210,000 42,000 1,370,000 192,000 35,000 1,135,000 Required: 1. Compute the return on investment for each division. 2. Compute the residual income for each division. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the return on investment for each division. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) Peak View Grand Return on Investment < Required1 Required 2 Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.01 percent. Selected operating data for the three divisions follovw: Peak View Grand 310,000 192,000 Sales revenue Cost of goods sold Miscellaneous operating expenses Average invested assets 337,000 $ 223,000 $ 210,000 42,000 1,370,000 119,000 32,000 870,000 35,000 1,135,000 Required: 1. Compute the return on investment for each division. 2. Compute the residual income for each division. Complete this question by entering your answers in the tabs below. Required 1 Required 2 come f******* divicion Ounts termedi Compute the residual income for each division. (Loss amounts should be indicated by a minus sign. Do not round intermediate: calculations. Round your answers to nearest whole dollar.) Peak View Grand Residual Income (Loss) Required 1 Required 2 >

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.01 percent. Selected operating data for the three divisions follow:
 

    Peak   View   Grand
Sales revenue $ 337,000 $ 223,000 $ 310,000
Cost of goods sold   210,000   119,000   192,000
Miscellaneous operating expenses   42,000   32,000   35,000
Average invested assets   1,370,000   870,000   1,135,000
 


Required:
1. Compute the return on investment for each division.
2. Compute the residual income for each division.

Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.01 percent. Selected operating data for
the three divisions follow:
Peak
View
Grand
337,000 $ 223,000 $ 310,000
119,000
32,000
870,000
Sales revenue
Cost of goods sold
Miscellaneous operating expenses
Average invested assets
210,000
42,000
1,370,000
192,000
35,000
1,135,000
Required:
1. Compute the return on investment for each division.
2. Compute the residual income for each division.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Compute the return on investment for each division. (Enter your ROI answers as a percentage rounded to two decimal places,
(i.e., 0.1234 should be entered as 12.34%.))
Peak
View
Grand
Return on Investment
< Required1
Required 2
Transcribed Image Text:Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.01 percent. Selected operating data for the three divisions follow: Peak View Grand 337,000 $ 223,000 $ 310,000 119,000 32,000 870,000 Sales revenue Cost of goods sold Miscellaneous operating expenses Average invested assets 210,000 42,000 1,370,000 192,000 35,000 1,135,000 Required: 1. Compute the return on investment for each division. 2. Compute the residual income for each division. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the return on investment for each division. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) Peak View Grand Return on Investment < Required1 Required 2
Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.01 percent. Selected operating data for
the three divisions follovw:
Peak
View
Grand
310,000
192,000
Sales revenue
Cost of goods sold
Miscellaneous operating expenses
Average invested assets
337,000 $ 223,000 $
210,000
42,000
1,370,000
119,000
32,000
870,000
35,000
1,135,000
Required:
1. Compute the return on investment for each division.
2. Compute the residual income for each division.
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
come f*******
divicion
Ounts
termedi
Compute the residual income for each division. (Loss amounts should be indicated by a minus sign. Do not round intermediate:
calculations. Round your answers to nearest whole dollar.)
Peak
View
Grand
Residual Income (Loss)
Required 1
Required 2 >
Transcribed Image Text:Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.01 percent. Selected operating data for the three divisions follovw: Peak View Grand 310,000 192,000 Sales revenue Cost of goods sold Miscellaneous operating expenses Average invested assets 337,000 $ 223,000 $ 210,000 42,000 1,370,000 119,000 32,000 870,000 35,000 1,135,000 Required: 1. Compute the return on investment for each division. 2. Compute the residual income for each division. Complete this question by entering your answers in the tabs below. Required 1 Required 2 come f******* divicion Ounts termedi Compute the residual income for each division. (Loss amounts should be indicated by a minus sign. Do not round intermediate: calculations. Round your answers to nearest whole dollar.) Peak View Grand Residual Income (Loss) Required 1 Required 2 >
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