Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets ROI $ 1,800,000 435,000 1,365,000 1,005,000 $360,000 $1,200,000 At the beginning of this year, the company has a $300,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $ 360,000 70 of sales $ 216,000 The company's minimum required rate of return is 10%. 6. What is the ROI related to this year's investment opportunity?

Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets ROI $ 1,800,000 435,000 1,365,000 1,005,000 $360,000 $1,200,000 At the beginning of this year, the company has a $300,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $ 360,000 70 of sales $ 216,000 The company's minimum required rate of return is 10%. 6. What is the ROI related to this year's investment opportunity?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Selected data from Division A of Green Company are as follows: Sales $ 630,000 Average investment $ 491,400 Operating income $ 81,900 Minimum rate of return 15% If the minimum rate of return was 11% (instead of the percentage shown above), Division A's residual income (RI) would be:
A company reported the following for its most recent year of operations: Return on investment Average operating assets Minimum required rate of return 20% $170,000 15% Given this information, the residual income for the year was: 24
LaLa Company has income from operations of $23,280, invested assets of $97,000, and sales of $388,000. What is the return on investment (ROI) for this company? Group of answer choices 24% 25% 100% none of these
Leete Inc. reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income 14.000.000 9.660.000 4,340,000 3,620,000 720,000 The Company's average operating assets were $8,000,000. It's minimum required return was 8%. 1. What is the company's margin percentage? 2. What is the company's turnover? 3. What is the company's return on investment? 4. What is the company's residual income?
Required information [The following information applies to the questions displayed below.] Westerville Company reported the following results from last year's opera Sales Variable expenses Contribution margin Fixed expenses $ 1,600,000 700,000 900,000 660,000 Net operating income 240,000 Average operating assets $ 1,000,000 At the beginning of this year, the company has a $325,000 investment oppor characteristics: $ 520,000 Sales Contribution margin ratio Fixed expenses 70 % of sales $ 312,000 The company's minimum required rate of return is 15%. 3. What is last year's return on investment (ROI)? ROI
Please help me with show all calculation thanku
Last year’s contribution format income statement for Huerra Company is given below: Total Unit Sales $ 1,002,000 $ 50.10 Variable expenses 601,200 30.06 Contribution margin 400,800 20.04 Fixed expenses 316,800 15.84 Net operating income 84,000 4.20 Income taxes @ 40% 33,600 1.68 Net income $ 50,400 $ 2.52 The company had average operating assets of $491,000 during the year. Required: Compute last year’s margin, turnover, and return on investment (ROI). For each of the following questions, indicate whether last year’s margin and turnover will increase, decrease, or remain unchanged as a result of the events described, and then compute the new ROI. Consider each question separately. Using Lean Production, the company is able to reduce the average level of inventory by $100,000. The company achieves a cost savings of $10,000 per year by using less costly materials. The company purchases machinery and equipment that increase average operating assets by $125,000.…
The Box Manufacturing Division of the Allied Paper Company reported the following results from the past year. Shareholders require a return of 9%. Management calculated a weighted average cost of capital (WACC) of 3%. Allied's corporate tax rate is 30%. $700,000 105,000 Sales Operating income Total assets 1,600,000 400,000 Current liabilities What is the division's Return on Investment (ROI)? O A. 57.14% O B. 43.75% O C. 6.56% O D. 15.00%
Walsh Corporation has two divisions: East and West. Data from the most recent month appear below: East West Sales $ 330,000 $144,000 Variable expenses $ 132,000 $ 76,320 Traceable fixed expenses $ 140,000 $ 43,000 The company's common fixed expenses total $52,140, If the company operates at exactly the break even sales of the East Division and West Diveion, what would be the company's overall net operating income? Select one: O a $30,540 O b. 50 OC ($52,140) Od. ($235,140)
Best Sleep Company reported the following results from last year's operations: Sales $ 1,500,000 Variable expenses 650,000 Contribution margin 850,000 Fixed expenses 580,000 Net operating income $ 270,000 Average operating assets $ 1,000,000 At the beginning of this year, the company has a $160,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $ 240,000 70 % of sales $ 144,000 The company's minimum required rate of return is 10%. What is the ROI related to this year's investment opportunity?
The following information relates to last year's operations at the Dairy Division of Carrefour Bahrain: Minimum required rate of return Return on investment (ROI) Sales Turnover (on operating assets) 11% 14.4% $ 970,000 6 times What was the Dairy Division's net operating income last year? O $139,680 $106,700 $32,980 $23,280
Required information [The following information applies to the questions displayed below.] The following information relates to a company's operations for last year. $ 1,300,000 Sales Variable expenses Contribution margin 440,000 860,000 600,000 Fixed expenses Net operating income 260,000 Average operating assets 812,500 The company's minimum required rate of return is 15%. 1. Calculate last year's return on investment (ROI). ROI