The South Division of Wiig Company reported the following data for the current year.SalesVariable costsControllable fixed costsAverage operating assets1.2.3.Top management is unhappy with the investment center's return on investment (ROI). It asks the manager of the South Division tosubmit plans to improve ROI in the next year. The manager believes it is feasible to consider the following independent courses ofaction.Return on Investment$2,950,0001,947,000Increase sales by $300,000 with no change in the contribution margin percentage.Reduce variable costs by $155,000.Reduce average operating assets by 4%.Action 1595,000(a) Compute the return on investment (ROI) for the current year. (Round ROI to 2 decimal places, e.g. 1.57%.)Action 25,000,000Action 3(b) Using the ROI formula, compute the ROI under each of the proposed courses of action. (Round ROI to 2 decimal places, e.g.1.57%.)Return on investmentdo%%%%

The objective of the question is to calculate the return on investment (ROI) for the current year…

Answered: The South Division of Wiig Company…

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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