The Outdoor Sports Company produces a wide variety of sports equipment. Its newest division, Golf Technology, manufactures and sells a single product-AccuDriver, a golf club that uses global positioning satellite technology to improve the accuracy of golfers' shots. The demand for AccuDriver is relatively insensitive to price changes. The following data are available for Golf Technology, which is an investment center for Outdoor Sports: (Click the icon to view the data.) Read the requirements. Requirement 1. Compute Golf Technology's ROI if the selling price of AccuDrivers is $910 per club. Determine the formula used to calculate ROI, then calculate the ROI for Golf Technology. (Enter the ROI as a percentage, rounded to the nearest hundredth percent, X.XX%.) ROI =

The Outdoor Sports Company produces a wide variety of sports equipment. Its newest division, Golf Technology, manufactures and sells a single product-AccuDriver, a golf club that uses global positioning satellite technology to improve the accuracy of golfers' shots. The demand for AccuDriver is relatively insensitive to price changes. The following data are available for Golf Technology, which is an investment center for Outdoor Sports: (Click the icon to view the data.) Read the requirements. Requirement 1. Compute Golf Technology's ROI if the selling price of AccuDrivers is $910 per club. Determine the formula used to calculate ROI, then calculate the ROI for Golf Technology. (Enter the ROI as a percentage, rounded to the nearest hundredth percent, X.XX%.) ROI =

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

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Concept explainers

Management by Exception

A manager’s job is a very tough one. A manager needs to look at the various areas of work and as a manager he has to look after two or more important jobs or activities at the same time for the growth of the business. In order to do all these things in an effective manner, a manager must adopt or practice different management styles and tactics.

Question

Data table
Total annual fixed costs
Variable cost per AccuDriver
Number of AccuDrivers sold each year
Average operating assets invested in the division
Print
Done
$ 28,000,000
700
140,000
$ 55,000,000
2. If management requires an ROI of at least 20% from the division, what is the
minimum selling price that the Golf Technology Division should charge per
AccuDriver club?
3. Assume that Outdoor Sports judges the performance of its investment centers on
the basis of RI rather than ROI. What is the minimum selling price that Golf
Technology should charge per Accu Driver if the company's required rate of return
is 18%?

The Outdoor Sports Company produces a wide variety of sports equipment. Its newest division, Golf Technology, manufactures and sells a single
product-AccuDriver, a golf club that uses global positioning satellite technology to improve the accuracy of golfers' shots. The demand for
AccuDriver is relatively insensitive to price changes. The following data are available for Golf Technology, which is an investment center for
Outdoor Sports:
(Click the icon to view the data.)
Read the requirements.
Requirement 1. Compute Golf Technology's ROI if the selling price of AccuDrivers is $910 per club.
Determine the formula used to calculate ROI, then calculate the ROI for Golf Technology. (Enter the ROI as a percentage, rounded to the nearest
hundredth percent, X.XX%.)
ROI =

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ROI and RI. (D. Kleespie, adapted) The Sports Equipment Company produces a wide variety of sports equipment. Its newest division, Golf Technology, manufactures and sells a single product— AccuDriver, a golf club that uses global positioning satellite technology to improve the accuracy of golfers’ shots. The demand for AccuDriver is relatively insensitive to price changes. The following data are available for Golf Technology, which is an investment center for Sports Equipment:
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