Question

A family friend has asked for your help in analyzing the operations of three anonymous companies. Supply the missing data in the tabulation below: (Negative amounts should be indicated with a minus sign.) А Company в $ 6,800,000 240,000 с $9,400,000 Sales 10.870.000 4,120,000 17% 5,200,000 23 % 15% Net operating income Average operating assets Return on investment Minimum required rate of return: Percentage Dollar amount Residual income (loss) 15 % % % 320,000 156,000

Answer 1

			A	B	C
Sales			10,870,000	6,800,000	9,400,000
net operating income			700400	240,000	1,196,000
Average operating assets			4,120,000	1600000	5,200,000
Return on Investment			17%	15%	23%
Minimum required rate of return
percentage			15%	20%	20%
dollar amount			618000	320,000	1,040,000
Residual income			82400	-80,000	156,000
Formulas
ROI = net operating income/average operating asset
Residual income = net income -( average operating assets*min rate of return)