The Marine Division of Pacific Corp. has average invested assets of $110,000,000. Sales revenue of $50,210,000 results in an operating income of $9,967,000. The hurdle rate is 6%. a. Calculate the return on investment. (Round your answer to 2 decimal places.) Return on Investment % b. Calculate the profit margin. (Round your answer to 2 decimal places.) Profit Margin % c. Calculate the investment turnover. (Round your answer to 4 decimal places.)
The Marine Division of Pacific Corp. has average invested assets of $110,000,000. Sales revenue of $50,210,000 results in an operating income of $9,967,000. The hurdle rate is 6%. a. Calculate the return on investment. (Round your answer to 2 decimal places.) Return on Investment % b. Calculate the profit margin. (Round your answer to 2 decimal places.) Profit Margin % c. Calculate the investment turnover. (Round your answer to 4 decimal places.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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30.
Transcribed Image Text:The Marine Division of Pacific Corp. has average invested assets of $110,000,000. Sales revenue of $50,210,000 results in an
operating income of $9,967,000. The hurdle rate is 6%.
a. Calculate the return on investment. (Round your answer to 2 decimal places.)
Return on Investment
%
b. Calculate the profit margin. (Round your answer to 2 decimal places.)
Profit Margin
%
c. Calculate the investment turnover. (Round your answer to 4 decimal places.)
Investment Turnover
d. Calculate the residual income.
Residual Income
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I need help with part d.
Transcribed Image Text:The Marine Division of Pacific Corp. has average invested assets of $110,000,000. Sales revenue of $50,210,000 results in an
operating income of $9,967,000. The hurdle rate is 6%.
a. Calculate the return on investment. (Round your answer to 2 decimal places.)
Return on Investment
9.06 %
b. Calculate the profit margin. (Round your answer to 2 decimal places.)
Profit Margin
19.85 %
c. Calculate the investment turnover. (Round your answer to 4 decimal places.)
Investment Turnover
0.4564
4 decimal places required.
d. Calculate the residual income.
Residual Income
Solution
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