ACC 202 MANAGERIAL ACCOUNTING >C<
ACC 202 MANAGERIAL ACCOUNTING >C<
21st Edition
ISBN: 9781264444489
Author: Garrison
Publisher: MCG CUSTOM
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Chapter 11, Problem 11E

1

To determine

Concept introduction:

Return on investment:

The Return on Investment is also called ROI. The return means the profit you make as a result of your investments. Return on Investment is a performance measure used to evaluate the profitability or efficiency of an investments or compare the efficiency of a number of investments. ROI is generally defined as the ratio of net profit over the total cost of the investment. ROI is calculated by dividing the net income by the total cost of the investment.

The table showing the relation between sales and return on investment

2

To determine

Concept introduction:

Return on investment:

The Return on Investment is also called ROI. The return means the profit you make as a result of your investments. Return on Investment is a performance measure used to evaluate the profitability or efficiency of an investments or compare the efficiency of a number of investments. ROI is generally defined as the ratio of net profit over the total cost of the investment. ROI is calculated by dividing the net income by the total cost of the investment.

What happened to the company’s return on investment as sales increase

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Sisu, Oliver and Jones are partners. They share profits and losses in the ratios 2/5,2/5 and 1/5 respectively.  For the year ended 31 December 19x6 their capital accounts remained fixed at the following amounts  Sisu R6000  Oliver R4000  Jones R2000  They have agreed to give each other 10 per cent per annum on their capital accounts. In addition to the above partnership salaries of R3000 for Oliver and R1000 for Jones are to be charged. The net profit of the partnership before taking any of the above into account was R25200. You are required to draw up the appropriation statement of the partnership for the year ended 31 December 19x6
Please explain the solution to this general accounting problem using the correct accounting principles.
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