Give answer to me Question:The Top Hat Division of Blandon's Fine Menswear had the following results last year (inthousands).Sales$4,500,000Operating income $675,000Total assets$3,000,000Current liabilities $250,000Management's target rate of return is 12% and the weighted average cost of capital is9%.a. What is the Top Hat Division's sales margin?b. What is the Top Hat Division's capital turnover?

Explanation of Sales Margin: Sales margin is a measure of profitability that indicates how much of…

Answered: Question: The Top Hat Division of…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter10: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 4BE: Profit margin, investment turnover, and ROI Briggs Company has operating income of 36,000, invested...

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Assume the Hiking Shoes division of the Simply Shoes Company had the following results last year (in thousands). Management's target rate of return is 30% and the weighted average cost of capital is 15%. Its effective tax rate is 30%. Sales Operating income Total assets Current liabilities What is the division's Return on Investment (ROI)? A. 68.57% B. 171.43% C. 40% O D. 22.57% $6,000,000 2,400,000 3,500,000 790,000 CO
Assume the Hiking Shoes division of the All About Shoes Corporation had the following results last year (in thousands). Management's target rate of return is 30% and the weighted average cost of capital is 5%. Its effective tax rate is 35%. Sales $14,000,000 Operating income Total assets 3,500,000 2,000,000 770,000 Current liabilities What is the division's sales margin? O A. 175.00% B. 25.00% OC. 38.50% O D. 700.00%
Assume the Hiking Shoes division of the Simply Shoes Company had the following results last year (in thousands). Management's target rate of return is 10% and the weighted average cost of capital is 30%. Its effective tax rate is 40%. Sales Operating income Total assets Current liabilities What is the division's Residual Income (RI)? OA. $100,000 O B. $4,400,000 Ⓒ C. $700,000 O D. $280,000 $11,000,000 1,100,000 4,000,000 780,000
Assume the Hiking Shoes division of the Simply Shoes Company had the following results last year (in thousands). Management's target rate of return is 30% and the weighted average cost of capital is 10%. Its effective tax rate is 30%. Sales Operating income Total assets Current liabilities What is the division's capital turnover? O A. 1.11 O B. 6 O C. 6.67 O D. 1.33 $6,000,000 900,000 1,000,000 750,000 (…)
Creative Analysis, Inc. is currently operating at maximum capacity. Assume that all costs and net working capital vary directly with sales. The dividend payout ratio will remain constant. How much is the External Financing needed (EFN) if sales are projected to increase by 10%? Income Statement end of last year: Sales $8,500 Costs $7,960 Net Income $540 Dividends paid = $324 Balance Sheet as of end of last year: Cash Accounts Receivables Inventory Net Fixed Assets Total assets -$25.1 $156.1 O $296.5 -$67.6 O $274.9 Assets $1,600 $975 $2,425 $2,200 $7,200 Accounts Payable Long-Term Debt Common Stock Retained Earnings Total Liabilities & Equity Liabilities & Equity $2,075 425 $3000 $1,700 $7,200
Yale Corporation had the following results last year (in thousands). Management's target rate of return is 20% and the weighted average cost of capital is 15%. Its effective tax rate is 30%. Sales $25,000,000 Operating income 1,000,000 Total assets 2,000,000 Current liabilities 5,670,000 What is the division's Return on Investment (ROI)?
Assume the Hiking Shoes division of the Simply Shoes Company had the following results last year (in thousands). Management's target rate of return is 30% and the weighted average cost of capital is 5%, its effective tax rate is 35%. Sales Operating income Total assets Current liabilities What is the division's Residual Income (RI)? ⒸA. $280,000 OB. $1,750,000 OC. $800,000 OD. $1,800,000 $5,000,000 2,000,000 4,000,000 840,000
Calculate return on investment and give true answer
Profit margin, investment turnover, and ROI Briggs Company has operating income of 36,000, invested assets of 180,000, and sales of 720,000. Use the DuPont formula to compute the return on investment and show (A) the profit margin, (B) the investment turnover, and (C) the return on investment.
The income statement comparison for Rush Delivery Company shows the income statement for the current and prior year. A. Determine the operating income (loss) (dollars) for each year. B. Determine the operating income (percentage) for each year. C. The company made a strategic decision to invest in additional assets in the current year. These amounts are provided. Using the total assets amounts as the investment base, calculate the ROI. Was the decision to invest additional assets in the company successful? Explain. D. Assuming an 8% cost of capital, calculate the RI for each year. Explain how this compares to your findings in part C.
SS
Assume the hiking shoes division of the all about shoes corporation had the following results last year (in thousands). Managements target rate of return is 15% and the weighted average cost of capital is 25%, it's effective tax rate is 30%.

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