Westerville Company reported the following results from last year’s operations: Sales $ 1,000,000 Variable expenses 300,000 Contribution margin 700,000 Fixed expenses 500,000 Net operating income $
Q: For its three investment centers, Concord Company accumulates the following data: I Sales $2,280,000…
A: The objective of the question is to calculate the expected return on investment (ROI) for each of…
Q: Beginning of year operating assets $3,220,000 End of year operating assets 3,020,000…
A: GIVEN Wildhorse Corp. reported the following: Beginning of year operating assets…
Q: The contribution format income statement for Huerra Company for last year is given below:…
A: Requirement:-1 Computation of the company’s margin, turnover, and return on investment (ROI) for the…
Q: What was the Legume Division's net operating income last year?
A: Introduction:-Net operating income denotes the capability of a property to produce an income from…
Q: Last year's contribution format income statement for Huerra Company is given below: Sales Variable…
A: Since you have posted a question with multiple sub-parts, we will do the first three sub-parts for…
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: Youns Incorporated reported the following results from last year’s operations: Sales $ 10,500,000…
A: Assets turnover ratio: Assets turnover ratio measures the efficiency of a company's assets to…
Q: The following information relates to last year's operations at the Legumes Division of Gervani…
A: The return on investment is calculated as net operating income divided by average operating assets.…
Q: Westerville Company reported the following results from last year's operations: Sales Variable…
A: Margin is the ratio between net operating income and sales revenue. It is calculated by dividing…
Q: Ryan Division has the following results for the year: Revenues $470,000 Net…
A: Residual Income: Residual income is the income that a company earns after paying off all the…
Q: Margin, Turnover, Return on Investment, Average Operating Assets Elway Company provided the…
A: Ratio analysis helps to analyze the financial statements of the company. The management can take…
Q: The Electronics Division of Anton Company reports the following results for the current year:…
A: ROI of a company refers to its profitability which is calculated as a ratio of the income to the…
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: Coolbrook Company has the following information available for the past year: Sales revenue Cost of…
A: The return on investment is used in evaluating the profitability using the metric for the…
Q: Silver Incorporated reported the following results from last year’s operations: Sales $…
A: Return on investment (ROI) :— It is the ratio between net operating income and average operating…
Q: Frieden Company's contribution format income statement for last month is shown below: Sales (30,000…
A: Lets understand the basics.Contribution margin income statement is a statement which shows…
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: Mitsu Division has the following results for the year: Revenues $1,080,000…
A: Residual income is a financial performance metric that measures the net income a company or business…
Q: The Electronics Division of Anton Company reports the following results for the current year:…
A: Return on investment is calculated by dividing the operating income by the 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 Electronics Division of Anton Company reports the following results for the current year:…
A: Return on investment is calculated by dividing net operating income by average operating assets.…
Q: The income statement for Symbiosis Manufacturing Company for the year is as follows: Sales (10,000…
A:
Q: The following information relates to last year's operations at the Legumes Division of Gervani…
A: Investment turnover = Investment turnover measures the efficiency of a company's assets to generate…
Q: [The following information applies to the questions displayed below.] Westerville Company reported…
A: Turnover is the ratio between sales by average operating assets. It is calculated by dividing sales…
Q: Sales (42,000 units) Variable expenses $ 294,000 168,000 $ 7.00 4.00 Contribution margin Fixed…
A: Operating income refers to the earnings made by the entity after deducting the total operating…
Q: Westerville Company reported the following results from last year's open Sales Variable expenses…
A: Turnover = Sales/Average operating assets
Q: Westerville Company reported the following results from last year's operations: Sales Variable…
A: The formula of turnover related to the investment reflects the times of sales earned with respect to…
Q: The income statement for Huerra Company for last year is provided below: Total Unit Sales $…
A: Since you have posted a question with multiple sub parts, we will provide the solution only to the…
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: Required information [The following information applies to the questions displayed below.]…
A: The most important profit statistic in real estate is net operating income (NOI). It aims to…
Q: BR Company has a contribution margin of 15%. Sales are $633,000, net operating income is $94,950,…
A: ROI = Net operating income / Average operating assets
Q: Hudson Company reports the following contribution margin income statement. HUDSON COMPANY…
A: Decrease in sales ( units ) = 9,600 units x 5% = 480 units New sales ( units ) = 9,600 units - 480…
Q: [The following information applies to the questions displayed below.] Westerville Company reported…
A:
Q: Required information [The following information applies to the questions displayed below.)…
A: Residual income is the excess earnings earned by the entity over net income. It can be computed…
Q: Required information [The following information applies to the questions displayed below.]…
A: Return on investment indicates the percentage of earning the business is gaining from the…
Q: Whirly Corporation’s most recent income statement is shown below: Total Per Unit Sales…
A: The contribution margin is calculated as the difference between the sales and variable costs. The…
Q: Last year’s contribution format income statement for Huerra Company is given below: Total Unit…
A: An investor can use the mathematical formula known as return on investment, or ROI, to assess their…
Q: BR Company has a contribution margin of 16%. Sales are $446,000, net operating income is $71,360,…
A: Return On Investment: This ratio is one of the most important ratios for calculating overall…
Q: Morton Company’s contribution format income statement for last month is given below: Sales (48,000…
A: The monetary levels of revenue at which a corporation earns no profit are referred to as break-even…
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: esterville Company reported the following results from last year’s operations: Sales $ 1,500,000…
A: Margin represents the percentage income earned by the company on the sales. It is calculated by…
Q: 5. As a result of a more intense effort by sales people, sales are increased by 10%; operating…
A: 1. The Margin, Turnover and ROI is calculated without considering the adjustments. 2. The above is…
Westerville Company reported the following results from last year’s operations:
Sales | $ 1,000,000 |
---|---|
Variable expenses | 300,000 |
Contribution margin | 700,000 |
Fixed expenses | 500,000 |
Net operating income | $ 200,000 |
Average operating assets | $ 625,000 |
At the beginning of this year, the company has a $120,000 investment opportunity with the following cost and revenue characteristics:
Sales | $ 200,000 | |
---|---|---|
Contribution margin ratio | 60 | % of sales |
Fixed expenses | $ 90,000 |
The company’s minimum required
4. What is the margin related to this year’s investment opportunity?
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- The Electronics Division of Anton Company reports the following results for the current year: Revenues $ 553,000 Operating expenses $ 496,000 Operating income $ 57,000 Operating assets $ 670,000 Anton Company has set a target return on investment (ROI) of 14% for the Electronics Division.The Electronic Division's margin is: Multiple Choice 11.49%. 15.80%. 10.31%. 8.51%.The company had an overall return on investment (ROI) of 15% this year (considering all divisions). Next year the Office Products Division has an opportunity to add a new product line that would require an additional investment that would increase average operating assets by $1,000,000. The cost and revenue characteristics of the new product line per year would be: Sales $2,000,000 Variable expenses 60% of sales Fixed expenses $640,000 Required: 1. Compute the Office Products Division's margin, turnover, and ROI for this year. 2. Compute the Office Products Division's margin, turnover, and ROI for the new product line by itself. 3. Compute the Office Products Division's margin, turnover, and ROI for next year assuming that it performs the same as this year and adds the new product line. 4. If you were in Dell Havasi's position, would you accept or reject the new product line? Explain. 5. Why do you suppose headquarters is anxious for the Office Products Division to add the new product…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.…
- Cabell Products is a division of a major corporation. Last year the division had total sales of $11,650,000, net operating income of $1,141,700, and average operating assets of $3,495,000. The company's minimum required rate of return is 11%. The division's residual income is closest to: Multiple Choice $1,141,700 $1,526,150 $757,250 $(768,900)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?Green Valley Corp.'s contribution format income statement for the most recent month follows: Sales $ 506,000 Variable expenses 236,500 Contribution margin 269,500 Fixed expenses 241,700 Net operating income $ 27,800 Required: a. Compute the degree of operating leverage to two decimal places. b. Using the degree of operating leverage, estimate the percentage change in net operating income that should result from a 3% increase in sales. c. If Green Valley’s competitor Black Mountain Inc. has a degree of operating leverage as 8, which company has the higher operating risk?
- 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 RELSRequired information Skip to question [The following information applies to the questions displayed below.] Westerville Company reported the following results from last year's operations: Sales $ 1,500,000 Variable expenses 730, 000 Contribution margin 770, 000 Fixed expenses 470,000 Net operating income $ 300,000 Average operating assets $ 937,500 At the beginning of this year, the company has a $362, 500 investment opportunity with the following cost and revenue characteristics: Sales $ 580,000 Contribution margin ratio 70% of sales Fixed expenses $ 319,000 The company's minimum required rate of return is 10%. 8. If the company pursues the investment opportunity and otherwise performs the same as last year, what turnover will it earn this year? (Round your answer to 2 decimal places.)Westerville 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,…
- Kyle Corporation provides the following information for the Product Division and Service Division for the year. Product Division Service Division 420,000 $ 650,000 195,000 245,000 640,000 610,000 14.0% 14.0% Net sales Operating income Average total assets Target rate of return $ Requirement 1. Calculate the return on investment for each division. (Enter answers as a percent rounded to the nearest hundredth percent, X.XX%) The return on investment for the Product Division is The return on investment for the Service Division is Requirement 2. Which division has the highest ROI? % % Requirement 3. Calculate the residual income for each division. (Round answers to the nearest whole dollar.) The residual income for the Product Division is The residual income for the Service Division is Requirement 4. Which division has the highest residual income?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 At the beginning of this year, the company has a $300,000 investment opportunity with the following cost and revenue characteristics: Sales $ 480,000 $ 336,000 The company's minimum required rate of return is 15%. $ 1,400,000 680,000 720,000 440,000 $ 280,000 $ 875,000 Contribution margin ratio Fixed expenses 9. If the company pursues the investment opportunity and otherwise performs the same as last year, what ROI will it earn this year? (Do not round intermediate calculations. Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) 37.3 % 80% of salesWesterville 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%. 2. What is last year’s turnover? (Round your answer to 1 decimal place.) 3. What is last year’s return on investment (ROI)? (Round your intermediate calculations to 1 decimal place.) 4. What is the margin related to this year’s investment opportunity? 5. What is the turnover related to this year’s investment opportunity? (Round your answer to 1 decimal place.)