Required information Exercise 11-12 (Algo) Effects of Changes in Profits and Assets on Return on Investment (ROI) [LO11-1] [The following information applies to the questions displayed below.] Fitness Fanatics is a regional chain of health clubs. The managers of the clubs, who have authority to make investments as needed, are evaluated based largely on return on investment (ROI). The company's Springfield Club reported the following results for the past year: Sales Net operating income Average operating assets The following questions are to be considered independently. Exercise 11-12 Part 1 (Algo) $ 860,000 $ 26,660 $ 100,000 Required: 1. Compute the Springfield club's return on investment (ROI). (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 20.00%

Required information Exercise 11-12 (Algo) Effects of Changes in Profits and Assets on Return on Investment (ROI) [LO11-1] [The following information applies to the questions displayed below.] Fitness Fanatics is a regional chain of health clubs. The managers of the clubs, who have authority to make investments as needed, are evaluated based largely on return on investment (ROI). The company's Springfield Club reported the following results for the past year: Sales Net operating income Average operating assets The following questions are to be considered independently. Exercise 11-12 Part 1 (Algo) $ 860,000 $ 26,660 $ 100,000 Required: 1. Compute the Springfield club's return on investment (ROI). (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 20.00%

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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Required information [The following information applies to the questions displayed below.] Fitness Fanatics is a regional chain of health clubs that evaluates its club managers based on return on investment (ROI). The company's Springfield Club reported the following results for the past year. Sales Net operating income Average operating assets $ 910,000 $ 32,760 $ 100,000 The following questions are to be considered independently. Required: I 1. Compute the Springfield club's return on investment (ROI). Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Return on investment (ROI) %
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Pls help... Your corporation is presenting its financial results for the year to the board of directors. You have created a model of premium service that have increased profit margins. However, the board members are concerned that this has been achieved by adding more staff instead of better use of technology compared to your competitors. What ratio should the board members be looking for to see if their apprehensions are justified? Group of answer choices SG&A/Sales ROIC/Sales Return on sales PPE/Sales
The South Division of Wiig Company reported the following data for the current year. Sales Variable costs Controllable fixed costs Average operating assets 1. 2. 3. Top management is unhappy with the investment center's return on investment (ROI). It asks the manager of the South Division to submit plans to improve ROI in the next year. The manager believes it is feasible to consider the following independent courses of action. Return on Investment $2,950,000 1,947,000 Increase sales by $300,000 with no change in the contribution margin percentage. Reduce variable costs by $155,000. Reduce average operating assets by 4%. Action 1 595,000 (a) Compute the return on investment (ROI) for the current year. (Round ROI to 2 decimal places, e.g. 1.57%.) Action 2 5,000,000 Action 3 (b) Using the ROI formula, compute the ROI under each of the proposed courses of action. (Round ROI to 2 decimal places, e.g. 1.57%.) Return on investment do % % % %
Problem 14-44 (Algo) Comparing Business Units Using Economic Value Added (EVA) (LO 14-4) Colonial Pharmaceuticals is a small firm specializing in new products. It is organized into two divisions, which are based on the products they produce. AC Division is smaller and the life of the products it produces tend to be shorter than those produced by the larger SO Division. Selected financial data for the past year is shown as follows. Divisional investment is as of the beginning of the year. Colonial Pharmaceuticals uses a 8 percent cost of capital and uses beginning of the-year Investment when computing ROI and residual income. Ignore income taxes. Allocated corp. overhead Cost of goods sold Divisional investment R&D AC Division $ 615 3,230 9,300 2,150 8,600 so Division $ 1,650 6,000 78, 500 3,600 18, 500 1,380 Sales SGRA 745 R&D is assumed to have a two-year life in the AC Divisilon and a nine year life in the SO division. All R&D expenditures are spent at the beginning of the year.…
A family friend has asked your help in analyzing the operations of three anonymous companies operating in the same service sector industry. Supply the missing data in the table below: (Loss amounts should be indicated by a minus sign. Round your percentage answers to nearest whole percent and other amounts to whole dollars.) Sales Net operating income Average operating assets Return on investment (ROI) Minimum required rate of return: Percentage Dollar amount Residual income $ $ A 470,000 160,000 15 % 16 % $ $ $ Company B 680,000 43,000 19 % 57,000 % C $ 560,000 $ 145,000 $ % 10 % 5,000
Assume that a company has decided to include "employee turnover" and "residual income" as performance measures within its balance scorecard. Which of the following choices reflects management's most likely expectations regarding how these measures should change over time? A) B) C) D) Employee turnover Increase Increase Decrease Decrease Multiple Choice. O O O O Choice A Choice B Choice C Choice D Residual Income Increase Decrease Increase Decrease
Categorize each of the following activities as to which management responsibility it fulfills: planning, directing, or controlling. Some activities may fulfill more than one responsibility. (Select an "X" in the input field if the management responsibility is fulfilled. If the management responsibility is not fulfilled, leave the input field empty.) Question content area bottom Part 1 Activity Management Responsibility Planning Directing Controlling a. Management decides to increase sales growth by 20% next year. b. Management analyzes the impact of a recent advertising campaign by comparing budgeted sales to actual sales. c. Management reviews hourly sales reports to determine the level of staffing needed to staff the customer service desk. d. Management uses information on product costs to determine sales prices. e. To lower production costs, management moves production to China.
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Return on investment Commodore Entertainment has four profitable business segments, described as follows: • Media Networks: Television and radio • Parks and Resorts: Resorts, including Commodore land • Studio Entertainment: Motion pictures, musical recordings, and stage plays • Consumer Products: Character merchandising, Commodore stores, books, and magazines Commodore Entertainment recently reported sector income from operations, revenue, and invested assets as follows: Media Networks Parks and Resorts Studio Entertainment Consumer Products Income from Invested Operations Revenue Assets $151,434 $676,800 $846,000 61,824 331,200 552,000 9,025 98,518 332,500 408,600 475,000 227,000 a. Use the DuPont formula to determine the return on investment for the four Commodore Entertainment sectors. Round Profit Margin and ROI to one decimal place and Investment Turnover to two decimal places. Media Networks Parks and Resorts Studio Entertainment Consumer Products Profit Margin Investment…