Chapter 11, Problem 1TF15

1.

To determine

Last year’s margin

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

2.

To determine

Last year’s turnover

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

3.

To determine

Last year’s return on investment (ROI)

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

4.

To determine

Margin related to this year’s investment opportunity

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

5.

To determine

The turnover related to this year’s investment opportunity.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

6.

To determine

The ROI related to this year’s investment opportunity.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

7.

To determine

If company purses the investment opportunity and otherwise performs the same as last year, give the margin it will earn this year.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

8.

To determine

If company purses the investment opportunity and otherwise performs the same as last year, give the turnover it will earn this year.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

9.

To determine

If company purses the investment opportunity and otherwise performs the same as last year, give the ROI it will earn this year.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

10.

To determine

Bonus is earned only when the ROI of current year exceeds from last year. Whether she will pursue the investment opportunity and will owner of the company allow pursuing the investments company.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

11.

To determine

Last year’s residual income.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

12.

To determine

Residual income of this year’s investment opportunity.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

13.

To determine

If the company pursues the investments opportunity and otherwise performs the same, explain the residual income it will earn this year.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

14.

To determine

Bonus is earned only when the ROI of current year exceeds from last year, whether she will pursue the investment opportunity.

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.

15.

To determine

If contribution margin ratio of investment opportunity was 50% instead of 60% and bonus is earned only when the ROI of current year exceeds from last year. Whether she will pursue the investment opportunity and will owner of the company want to pursue the investments company

Introduction: Return on investments is difference between cost of investment and net profit. It is also performance measure which evaluates the efficiency of the investment made. It is even used in comparing the efficiency of difference between investments.