**Required Information***The following information applies to the questions displayed below.*Westerville Company reported the following results from last year's operations:- **Sales**: $1,600,000- **Variable Expenses**: $700,000- **Contribution Margin**: $900,000- **Fixed Expenses**: $660,000- **Net Operating Income**: $240,000- **Average Operating Assets**: $1,000,000At the beginning of this year, the company has a $325,000 investment opportunity with the following characteristics:- **Sales**: $520,000- **Contribution Margin Ratio**: 70% of sales- **Fixed Expenses**: $312,000The company's minimum required rate of return is 15%.**Question 2: What is last year's turnover?** *(Round your answer to 1 decimal place.)*[Turnover input box]

Turnover = Sales/Average operating assets

Answered: Westerville Company reported the…

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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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?
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Westerville 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?
Required information [The following information applies to the questions displayed below.] Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses $ 1,600,000 700,000 900,000 660,000 Net operating income $4 240,000 Average operating assets $ 1,000,000 At the beginning of this year, the company has a $325,000 investment opportunity with the characteristics: Sales Contribution margin ratio Fixed expenses $ 520,000 70 % of sales $ 312,000 The company's minimum required rate of return is 15%. 9. If the company pursues the investment opportunity and otherwise performs the same as last year, wha (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be considered as 12.3%.)) ROI % ( Prev 1O Pr Ps to search RELS
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