Multinational performance measurement, ROI, RI. The Seaside Corporation manufactures similar products in the United States and Norway. The U.S. and Norwegian operations are organized as decentral- ized divisions. The following information is available for 2017; ROI is calculated as operating income divided by total assets: U.S. Division Norwegian Division 6,840,000 kroner Operating income Total assets ? $7,700,000 15.00% 72,000,000 kroner ROI ? Both investments were made on December 31, 2016. The exchange rate at the time of Seaside's investment in Norway on December 31, 2016, was 9 kroner = $1. During 2017, the Norwegian kroner decreased steadily in value so that the exchange rate on December 31, 2017, is 10 kroner ing 2017 is [(9 + 10) + 2] = 9.5 kroner = $1. $1. The average exchange rate dur- |3D

Multinational performance measurement, ROI, RI. The Seaside Corporation manufactures similar products in the United States and Norway. The U.S. and Norwegian operations are organized as decentral- ized divisions. The following information is available for 2017; ROI is calculated as operating income divided by total assets: U.S. Division Norwegian Division 6,840,000 kroner Operating income Total assets ? $7,700,000 15.00% 72,000,000 kroner ROI ? Both investments were made on December 31, 2016. The exchange rate at the time of Seaside's investment in Norway on December 31, 2016, was 9 kroner = $1. During 2017, the Norwegian kroner decreased steadily in value so that the exchange rate on December 31, 2017, is 10 kroner ing 2017 is [(9 + 10) + 2] = 9.5 kroner = $1. $1. The average exchange rate dur- |3D

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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Question

Calculate the Norwegian division’s ROI for 2017 in kroner.

Multinational performance measurement, ROI, RI. The Seaside Corporation manufactures similar
products in the United States and Norway. The U.S. and Norwegian operations are organized as decentral-
ized divisions. The following information is available for 2017; ROI is calculated as operating income divided
by total assets:
U.S. Division
Norwegian Division
6,840,000 kroner
Operating income
Total assets
?
$7,700,000
15.00%
72,000,000 kroner
ROI
?
Both investments were made on December 31, 2016. The exchange rate at the time of Seaside's investment
in Norway on December 31, 2016, was 9 kroner = $1. During 2017, the Norwegian kroner decreased steadily
in value so that the exchange rate on December 31, 2017, is 10 kroner
ing 2017 is [(9 + 10) + 2] = 9.5 kroner = $1.
$1. The average exchange rate dur-
|3D

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