PDT Co. has two divisions, East and West. Invested assets and condensed income statement data for each division for the past year ended December 31 are as follows: East Division West Division Revenues $1,200,000 $800,000 Operating expenses 950,000 640,000 Service department charges 145,000 72,000 Invested assets 800,000 500,000 (a) Prepare condensed income statements for the past year for each division. (b) Using the expanded expression, determine the profit margin, investment turnover, and rate of return on investment for each division. Round to one decimal place.
PDT Co. has two divisions, East and West. Invested assets and condensed income statement data for each division for the past year ended December 31 are as follows: East Division West Division Revenues $1,200,000 $800,000 Operating expenses 950,000 640,000 Service department charges 145,000 72,000 Invested assets 800,000 500,000 (a) Prepare condensed income statements for the past year for each division. (b) Using the expanded expression, determine the profit margin, investment turnover, and rate of return on investment for each division. Round to one decimal place.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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PDT Co. has two divisions, East and West. Invested assets and condensed income statement data for each division for the past year ended December 31 are as follows:
|
East Division |
West Division |
|
| Revenues |
$1,200,000 |
$800,000 |
| Operating expenses |
950,000 |
640,000 |
| Service department charges |
145,000 |
72,000 |
| Invested assets |
800,000 |
500,000 |
| (a) | Prepare condensed income statements for the past year for each division. |
| (b) | Using the expanded expression, determine the profit margin, investment turnover, and rate of |
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