Warren Company has two divisions with the following results:Sales revenueDivisional expensesSegment incomeAverage invested assetsErie$ 1,260,000856,000Ashland$ 456,000276,000$ 180,000$ 1,260,000$ 4,060,000$ 356,000Warren Company has a hurdle rate of 12.6 %.Required:a. Calculate the return on investment for each division.b. Break each division's return on investment down into its component parts using the DuPont method.c. Calculate the residual income for each division.Complete this question by entering your answers in the tabs below.Required A Required BRequired CCalculate the return on investment for each division.Note: Round your answers to 2 decimal places.AshlandErieInvestment%%<Required ARequired B >

Let's approach this step-by-step: a. Calculating the return on investment (ROI) for each…

Answered: Warren Company has two divisions with…

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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Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X Y Z Sales $ 1,470,000 $ 974,000 $ 4,861,000 Operating Income 173,200 172,300 180,500 Investment in assets 428,200 567,500 2,553,200 The return on sales (ROS) for Division Y is: Multiple Choice 3.7%. 30.4%. 17.7%. 11.8%.
The following information is available about the status and operations of the Manufacturing Division of Taylor Company, which has a hurdle rate of 6%. Divisional identifiable average assets $ 411,637 Divisional income from operations $ 18,924 Divisional sales revenue $ 368,363 1. Compute the ROI for the Manufacturing Division. 2. Break the Manufacturing Division ROI down using the Profit Margin and Investment turnover (DuPont) formula. 3. Compute the residual income for the Manufacturing Division.
Subject - account Please help me. Thankyou.
What is EVA for Division Y?
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Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Sales Average operating assets Net operating income Minimum required rate of return Division A $6,300,000 $1,260,000 $ 340,200 20.00% Division B $10,300,000 $ 5,150,000 $ 968,200 18.80% Division C $9,400,000 $1,880,000 $ 249,100 17.00% Required: 1. Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. I Margin Turnover ROI Division A 5.40 % times % Division B % 2.00 times :% Division C % times % 2. Compute the residual income (loss) for each division. (Loss amounts should be indicated by a minus sign. Roui Division A Division B Division C Average operating assets Required rate of return % % % Required operating income Actual operating income Required operating income (above) Residual income (loss) 3. Assume that each division is presented with an investment opportunity that would y a. If performance is being…
A company's division has sales of $2,610,000, income of $991,800, and average assets of $1,800,000. Compute the division's profit margin, return on investment, and investment turnover. Compute the Division's Profit Margin. Numerator: Denominator: Profit Margin Profit margin Compute the Division's Return on investment. Numerator: Denominator: Return on investment Return on investment Compute the Division's Investment Turnover. Numerator: Denominator: Investment Turnover %3D Investment turnover
Selected sales and operating data for three divisions of different structural engineering firms are given below: Division C $ 25,450,000 $ 5,090,000 $636,250 12.50% Sales Average operating assets Net operating income Minimum required rate of return Division A $ 12,360,000 $ 3,090,000 $ 494,400 7.00% Required: 1. Compute each division's margin, turnover, and return on investment (ROI). 2. Compute each division's residual income (loss). 3. Assume each division is presented with an investment opportunity yielding a 8% rate of return. a. If performance is being measured by ROI, which division or divisions will accept the opportunity? b. If performance is being measured by residual income, which division or divisions will accept the opportunity? Division B $ 28,360,000 $ 7,090,000 $ 453,760 7.50% Complete this question by entering your answers in the tabs below. Division A Division B Division C Required 1 Required 2 Required 3A Required 3B Assume each division is presented with an…
Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Required 1X Required 2 Sales Net operating income. Average operating assets Required: 1. For each division, compute the return on investment (ROI). 2. Compute the residual income for each division assuming the company's minimum required rate of return is 15%. Complete this question by entering your answers in the tabs below. ROI Osaka $ 10,500,000 $630,000 $ 3,500,000 Osaka Division For each division, compute the return on investment (ROI). % Yokohama $ 35,000,000 $ 2,800,000 $ 17,500,000 Yokohama %
Return on investment The operating income and the amount of invested assets in each division of Conley Industries are as follows: Operating Income Invested Assets Retail Division $72,600 $330,000 Commercial Division 117,600 490,000 Internet Division 224,100 830,000 a. Compute the return on investment for each division. (Round to the nearest whole percentage.) Division Percent Retail Division % Commercial Division % Internet Division b. Which division is the most profitable per dollar invested?
What is the investment turnover?

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