Posters.com is a small Internet retailer of high-quality posters. The company has $810,000 in operating assets and fixed expenses of $162,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $4,600,000 per year. The company’s contribution margin ratio is 10%, which means that an additional dollar of sales results in additional contribution margin, and net operating income, of 10 cents. Required: Complete the following table showing the relation between sales and return on investment (ROI). What happens to the company’s return on investment (ROI) as sales increase? req 1 Complete the following table showing the relation between sales and return on investment (ROI). (Round your percentage answers to 2 decimal places.) Sales Net Operating Income Average Operating Assets ROI $4,100,000 $248,000 $810,000 % $4,200,000 $810,000 % $4,300,000 $810,000 % $4,400,000 $810,000 % $4,500,000 $810,000 % $4,600,000 $810,000 % req 2 What happens to the company’s return on investment (ROI) as sales increase? increase or decreases
Posters.com is a small Internet retailer of high-quality posters. The company has $810,000 in operating assets and fixed expenses of $162,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $4,600,000 per year. The company’s contribution margin ratio is 10%, which means that an additional dollar of sales results in additional contribution margin, and net operating income, of 10 cents. Required: Complete the following table showing the relation between sales and return on investment (ROI). What happens to the company’s return on investment (ROI) as sales increase? req 1 Complete the following table showing the relation between sales and return on investment (ROI). (Round your percentage answers to 2 decimal places.) Sales Net Operating Income Average Operating Assets ROI $4,100,000 $248,000 $810,000 % $4,200,000 $810,000 % $4,300,000 $810,000 % $4,400,000 $810,000 % $4,500,000 $810,000 % $4,600,000 $810,000 % req 2 What happens to the company’s return on investment (ROI) as sales increase? increase or decreases
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Posters.com is a small Internet retailer of high-quality posters. The company has $810,000 in operating assets and fixed expenses of $162,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $4,600,000 per year. The company’s contribution margin ratio is 10%, which means that an additional dollar of sales results in additional contribution margin, and net operating income, of 10 cents.
Required:
- Complete the following table showing the relation between sales and
return on investment (ROI).
- What happens to the company’s return on investment (ROI) as sales increase?
req 1
Complete the following table showing the relation between sales and return on investment (ROI). (Round your percentage answers to 2 decimal places.)
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req 2
What happens to the company’s return on investment (ROI) as sales increase?
increase or decreases
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