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Required information [The following information applies to the questions displayed below.] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales $ 3,720,000 Net operating income $ 223,200 Average operating assets $ 930,000 The following questions are to be considered independently. 2. The entrepreneur who founded the company is convinced that sales will increase next year by 50% and that net operating income will increase by 310%, with no increase in average operating assets. What would be the company's ROI? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 9.84 %

Required information [The following information applies to the questions displayed below.] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales $ 3,720,000 Net operating income $ 223,200 Average operating assets $ 930,000 The following questions are to be considered independently. 2. The entrepreneur who founded the company is convinced that sales will increase next year by 50% and that net operating income will increase by 310%, with no increase in average operating assets. What would be the company's ROI? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 9.84 %

FINANCIAL ACCOUNTING
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.] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales Net operating income Average operating assets The following questions are to be considered independently. $ 3,720,000 $ 223,200 $ 930,000 2. The entrepreneur who founded the company is convinced that sales will increase next year by 50% and that net operating income will increase by 310%, with no increase in average operating assets. What would be the company's ROI? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 9.84 %
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales Net operating income Average operating assets The following questions are to be considered independently. $ 3,720,000 $ 223,200 $ 930,000 2. The entrepreneur who founded the company is convinced that sales will increase next year by 50% and that net operating income will increase by 310%, with no increase in average operating assets. What would be the company's ROI? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 9.84 %
Required information [The following information applies to the questions displayed below.] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales $ 3,720,000 $ 223,200 Net operating income. Average operating assets $ 930,000 The following questions are to be considered independently. 3. The Chief Financial Officer of the company believes a more realistic scenario would be a $1,900,000 increase in sales, requiring a $475,000 increase in average operating assets, with a resulting $628,230 increase in net operating income. What would be the company's ROI in this scenario? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 33.00 %
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales $ 3,720,000 $ 223,200 Net operating income. Average operating assets $ 930,000 The following questions are to be considered independently. 3. The Chief Financial Officer of the company believes a more realistic scenario would be a $1,900,000 increase in sales, requiring a $475,000 increase in average operating assets, with a resulting $628,230 increase in net operating income. What would be the company's ROI in this scenario? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) 33.00 %
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