The service division of Bridgeport Industries reported the following results for 2022. Sales Variable costs Controllable fixed costs Average operating assets 1. $430,000 258,000 Management is considering the following independent courses of action in 2023 in order to maximize the return on investment for this division. (a) 53,750 Reduce average operating assets by $107,500, with no change in controllable margin. 2. Increase sales $86,000, with no change in the contribution margin percentage. 537,500 Controllable margin Compute the controllable margin and the return on investment for 2022. Return on investment for 2022 $ %
The service division of Bridgeport Industries reported the following results for 2022. Sales Variable costs Controllable fixed costs Average operating assets 1. $430,000 258,000 Management is considering the following independent courses of action in 2023 in order to maximize the return on investment for this division. (a) 53,750 Reduce average operating assets by $107,500, with no change in controllable margin. 2. Increase sales $86,000, with no change in the contribution margin percentage. 537,500 Controllable margin Compute the controllable margin and the return on investment for 2022. Return on investment for 2022 $ %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The service division of Bridgeport Industries reported the following results for 2022.
Sales
Variable costs
Controllable fixed costs
Average operating assets
1.
$430,000
258,000
Management is considering the following independent courses of action in 2023 in order to maximize the return on investment for
this division.
(a)
53,750
Reduce average operating assets by $107,500, with no change in controllable margin.
2. Increase sales $86,000, with no change in the contribution margin percentage.
537,500
Controllable margin
Compute the controllable margin and the return on investment for 2022.
Return on investment for 2022
$
%
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