The West Division of Cecchetti Corporation had average operating assets of $643,000 and net operating income of $100,000 in August. The minimum required rate of return for performance evaluation purposes is 18%. What was the West Division's minimum required return in August?
Q: A firm operated at 80% of capacity for the past year, during which fixed costs were $191,000,…
A: Operating profit is the amount of profit which is earned by an entity from its operations. It is…
Q: Nicholas Technologies operates two divisions: Hardware Services and Software Services. During the…
A: Income statement is the financial statement that records all the income and expenses of the company.…
Q: Torres Company accumulates the following summary data for the year ending December 31, 2017, for its…
A: Formula: Contribution margin = sales - variable costs. Controllable margin = Contribution margin -…
Q: Westerville Company reported the following results from last year’s operations: Sales $…
A: RESIDUAL INCOME Residual income is the net income generated above the required rate of return…
Q: À week before the end of Its fiscal year, a company forecasts that it will not meet its target net…
A:
Q: Westerville Company reported the following results from last year’s operations: Sales $ 1,000,000…
A: Margin is the money borrowed from a broker to purchase an investment and is the difference between…
Q: 11. What is last year’s residual income? 12. What is the residual income of this year’s…
A: Residual Income :— Residual Income is income that one continues to receive after the completion of…
Q: Westerville Company reported the following results from last year’s operations: Sales $…
A: ROI is one of the profitability ratio which shows ratio between net operating income with average…
Q: westerville company reported the following results from last year's operations: sales $1,600,000…
A: An investment property is a piece of real estate purchased with the intention of generating a profit…
Q: A firm operated at 80% of capacity for the past year, during which fixed costs were $203,000,…
A: The objective of the question is to calculate the operating income of a firm given the fixed costs,…
Q: The Consumer Products Division of Goich Corporation had average operating assets of $425,000 and net…
A: The minimum required return in dollars is calculated as the minimum amount of return required to be…
Q: The following data has been provided for a company’s most recent year of operations: Return on…
A: The objective of this question is to calculate the residual income for the company's most recent…
Q: The Fulmar Division of Jayne Manufacturing had an ROI of 45% when sales were $6 million and…
A: Return on investment = Net operating income / Average operating assets
Q: Westerville Company reported the following results from last year’s operations: Sales $…
A: Profit margin is the percentage of income earned on the sales of a period after deducting the…
Q: The following data has been provided for a company's most recent year of operations: Return on…
A: Residual income = Average operating assets * ( Return on investment - Minimum required rate of…
Q: required rate of return
A: Rate of return is the profit expected from the average asset employed in the venture. It’s computed…
Q: Davison inc. consists of two districts, A and B. The company as a whole had sales of 500,000 a…
A: A fixed expense is just an expense in your plan that you can anticipate being constant or nearly…
Q: Crane Company reports the following operating results for the month of August: sales $378,000 (units…
A: Income statement is a financial statement that shows profitability, total revenue and total…
Q: A firm operated at 80% of capacity for the past year, during which fixed costs were $201,000,…
A: Marginal costing is the one widely used by the management to determine the impact of increase and…
Q: The West Division of Cecchetti Corporation had average operating assets of $639,000 and net…
A: The minimum required rate of return is the expected minimum return from the investment that the…
Q: A company's normal operating activity is to produce 870 units per month. During its first two months…
A: The relevant range defines the limits within which per-unit variable costs remain constant and…
Q: Ivanhoe Corporation has collected the following information after its first year of sales. Sales…
A: Lets understand the basicsCost-volume-profit (CVP) analysis is a managerial accounting technique…
Q: 1. ABC made 10,000 units in a month, and the operating costs were $100,000. To the nearest whole…
A: An operating expense is an expense a business incurs through its normal business operations.…
Q: For the current year, Power Cords Corp. expected to sell 40,400 industrial power cords. Fixed costs…
A: Margin of safety % = [current sales units - Break even sales units]/Current sales in Units
Q: he Pacific Division of Cullumber Industries reported the following data for the current year. Sales…
A: Return on investment is one of the profitability ratio which is being used in business. This shows…
Q: %. (a) Compute the return on investment (ROI) for the current year. (Round ROI to 2 decimal places,…
A: Return on Investment (ROI): It establishes the relationship between the net income and the assets or…
Q: The following data has been provided for a company’s most recent year of operations: Return on…
A: In non-public finance, residual earnings can talk over with an individual's discretionary earnings,…
Q: Corbel Corporation has two divisions: Division A and Division B. Last month, the company reported a…
A: Common fixed expenses are costs incurred by a company that do not vary with changes in production or…
Q: Mason Corporation had $1,170,000 in invested assets, sales of $1,211,000, operating income amounting…
A: Profit margin = Operating income / Sales
Q: The manager of the Fleet division of Potlatch Automotive is evaluated on her division’s return on…
A: Return on investment=Operating MarginInvested Capital×100 Residual Income=Operating Margin-Required…
Q: year, during which fixed costs were $207,000, variable costs were 63% of sales, and sales were…
A: Operating income involves the income generated by normal business transactions. This means that the…
Q: Rasmussen Corporation expects to incur indirect overhead costs of $80,000 per month and direct…
A: Manufacturing expenses are simply an expenditure study that estimates how each department in your…
Q: The contribution margin of the West business segment is:
A: Contribution margin the total amount of revenue available after covering variable costs to cover…
Q: Westerville Company reported the following results from last year’s operations: Sales $…
A: Return on investment (ROI) :— It is calculated by dividing net operating income by average operating…
Q: Sunland Corporation has collected the following information after its first year of sales. Sales…
A: The contribution margin is calculated as difference between sales revenue and variable costs. The…
Q: 1. Normal capacity of Evert Company is 120,000 direct labour hours. The expected capacity for the…
A: Predetermined overhead rate at normal capacity =Estimated FOHNormal capacity=$150,000120,000…
Q: sales agent in a year (computed as 52 weeks in one year x 5 days work/week x 8 hours/day) E.…
A: Blank 1: Production number of hours per sales agent in a year (90% productivity) = Total hours of…
Q: A firm operated at 80% of capacity for the past year, during which fixed costs were $209,000,…
A: By the CVP method, operating income is obtained by subtracting fixed costs from the total…
Q: Crane Company reports the following operating results for the month of August: sales $392,000 (4,900…
A: Income statement is a financial statement that shows profitability, total revenue and total…
Q: ivision Cleaning Products Division Sales $34,620,000…
A: Average Operating assets [A= (Jan1+Dec 31)/2 Minimum rate of return [B] Minimum income…
Q: Microsoft uses residual income to evaluate the performance of its divisions. The company's minimum…
A: Operating income: It is the revenue earned from day to day operational activities of the business…
Step by step
Solved in 2 steps
- A firm operated at 80% of capacity for the past year, during which fixed costs were $201,000, variable costs were 61% of sales, and sales were $919,000. Operating profit was a.$358,410 b.$157,410 c.$125,928 d.$560,590Corbel Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $43,000 for Division A. Division B had a contribution margin ratio of 30% and its sales were $240,000. Net operating income for the company was $35,200 and traceable fixed expenses were $50,400. Corbel Corporation's common fixed expenses were:Westerville Company reported the following results from last year’s operations: Sales $ 1,500,000 Variable expenses 500,000 Contribution margin 1,000,000 Fixed expenses 700,000 Net operating income $ 300,000 Average operating assets $ 1,000,000 At the beginning of this year, the company has a $200,000 investment opportunity with the following cost and revenue characteristics: Sales $ 300,000 Contribution margin ratio 60 % of sales Fixed expenses $ 132,000 The company’s minimum required rate of return is 10%. Required: 1. What is last year’s margin?
- The Casket Division of Saal Corporation had average operating assets of $1,020,000 and net operating income of $205,200 in January. The company uses residual income to evaluate the performance of its divisions, with a minimum required rate of return of 14%. Required: What was the Casket Division's residual income in January?Shalom Company's Peace Department had the following information last year Minimum required rate of return 18% Average operating assets Traceable fixed expenses Variable expenses Sales 2,000,000 90,000 310,000 1,000,000 What was Peace Department's return on investment?Searchlight, Inc. uses ROI to evaluate operations and requires the return on its operating units to be 9%. Operating data for the Western division is shown below: Sales $1,000,000 Controllable margin 120,000 Total average assets 600,000 Fixed costs 60,000 How much is ROI for the year? A. 20% B. 17% C. 10% D. 30%
- Cathy Company has two divisions, L and M. During July, Division L had sales of $80,000, a contribution margin ratio of 30%, and a segment margin of $10,000. The company as-a-whole had sales of $200,000, a contribution margin ratio of 40%, and a segment margin for the two divisions totaling $30,000. If operating income for the company was $15,000 for the month, the traceable fixed costs in Division M must have been: O $56,000 $36,000 $15,000 O $20,000 O $50,000Westerville Company reported the following results from last year’s operations: Sales $ 1,500,000 Variable expenses 690,000 Contribution margin 810,000 Fixed expenses 435,000 Net operating income $ 375,000 Average operating assets $ 1,250,000 At the beginning of this year, the company has a $350,000 investment opportunity with the following cost and revenue characteristics: Sales $ 420,000 Contribution margin ratio 70 % of sales Fixed expenses $ 252,000 The company’s minimum required rate of return is 10%. 1. Assume that the contribution margin ratio of the investment opportunity was 65% instead of 70%. If Westerville’s Chief Executive Officer will earn a bonus only if her residual income from this year exceeds her residual income from last year, would she pursue the investment opportunity? yes or no 2. Would the owners of the company want her to pursue the investment opportunity?Need Help with this Question solution provide
- Bramble Company reports the following operating results for the month of August: sales $300,000 (units 5,000); variable costs $217,000; and fixed costs $70,000. Management is considering the following independent courses of action to increase net income.Compute the net income to be earned under each alternative.1. Increase selling price by 10% with no change in total variable costs or sales volume. Net income $enter a net income if the selling price is increased by 10% 2. Reduce variable costs to 55% of sales. Net income $enter a net income if the variable costs are reduced to 55% of sales 3. Reduce fixed costs by $18,000. Net income $enter a net income if the fixed costs are reduced by $18,000Stryker corp. Has two major business segments- east and west. In April, the east business segment had sales revenue of 500,000, variable expenses of 280,000 and traceable fixed expenses of 80,000. During the same month, the west business segment had sales revenues of 970,000, variable expenses of 514,000 and traceable fixed expenses of 184,000. The common fixed expenses total 280,000 and were allocated as follows: 112,000 to the east business segment and 168,000 to the west business segment. A properly constructed segmented income statement in a contribution format would show that the segment margin of the east business segment is: 108,000 28,000 140,000 280,000Westerville Company reported the following results from last year’s operations: Sales $ 1,800,000 Variable expenses 740,000 Contribution margin 1,060,000 Fixed expenses 700,000 Net operating income $ 360,000 Average operating assets $ 1,200,000 At the beginning of this year, the company has a $400,000 investment opportunity with the following cost and revenue characteristics: Sales $ 600,000 Contribution margin ratio 60 % of sales Fixed expenses $ 288,000 The company’s minimum required rate of return is 10%. 6. What is the ROI related to this year’s investment opportunity? (Do not round intermediate calculations.) 7. If the company pursues the investment opportunity and otherwise performs the same as last year, what margin will it earn this year? (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 8. If the company pursues the investment opportunity and otherwise performs the same as last year,…