Required information [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. $ 820,000 $ 22,140 $ 100,000 4. Assume that the manager of the club is able to reduce average operating assets by $50,000 without any change in sales or net operating income. What would be the club's return on investment (ROI)? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Hh.114.

 

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Required information
[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
$ 820,000
Net operating income
$ 22,140
Average operating assets
$ 100,000
The following questions are to be considered independently.
4. Assume that the manager of the club is able to reduce average operating assets by $50,000 without any change in sales or net
operating income. What would be the club's return on investment (ROI)? (Do not round intermediate calculations. Round your answer
to 2 decimal places.)
Return on investment (ROI)
Transcribed Image Text:! Required information [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 $ 820,000 Net operating income $ 22,140 Average operating assets $ 100,000 The following questions are to be considered independently. 4. Assume that the manager of the club is able to reduce average operating assets by $50,000 without any change in sales or net operating income. What would be the club's return on investment (ROI)? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI)
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