An appropriate evaluation method of cost center is 1. Variable analysis 2. Return on investment (ROI)...
An appropriate evaluation method of cost center is
1. Variable analysis
2. Return on investment (ROI)
3. Return on assets (ROA)
4. Both return on assets (ROA) and return on investment (ROI).
Homework Answers
Answer:- 4
An appropriate evaluation method of cost centre is
Both return on assets (ROA) and return on investment (ROI).
generally most appropriate is
Return on investment
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An appropriate evaluation method of cost center is
1. Variable analysis
2. Return on investment (ROI)...
XYZ Company has net income of $240,000 on sales of $3,200,000. If the investment is $1,600,000,...
XYZ Company has net income of $240,000 on sales of $3,200,000. If the investment is $1,600,000, the return on sales is a. 15% b. 7.5% c. $10 d. 2 An appropriate evaluation method of cost center is 1. Variable analysis 2. Return on investment (ROI) 3. Return on assets (ROA) 4. Both return on assets (ROA) and return on investment (ROI).
10. Determine the April 2014 Return on Investment (ROI) for an investment center with the following...
10. Determine the April 2014 Return on Investment (ROI) for an investment center with the following information: Operating income for the month ended April 30, 2014 $80,000 65,000 After-tax operating income for April 30, 2014 Assets invested 25,000 Desired ROI 18% Actual ROI 20% (Round percentage answer to one decimal places.) ОА. 1.2 percentage ОВ. 2.6 percentage Oc. 3.2 percentage 75.5 percentage
Mastery Problem: Return on Investment, margin, and turnover Return on Investment (ROI) The manager of an...
Mastery Problem: Return on Investment, margin, and turnover Return on Investment (ROI) The manager of an investment center should be evaluated based on revenues, costs, and investments. An evaluation based on net income ignores the amount of investment the investment center required. One way to measure operating profit in relation to investment is a calculation called the return on investment. One formula for calculating return on investment is: Operating income Invested Assets ROI is effective because it takes into consideration...
Problem 10-20 Return on Investment (ROI) Analysis [LO10-1] The contribution format income statement for Huerra Company...
Problem 10-20 Return on Investment (ROI) Analysis [LO10-1] The contribution format income statement for Huerra Company for last year is given below: Total Unit Sales $ 4,000,000 $ 80.00 Variable expenses 2,800,000 56.00 Contribution margin 1,200,000 24.00 Fixed expenses 840,000 16.80 Net operating income 360,000 7.20 Income taxes @ 30% 108,000 2.16 Net income $ 252,000 $ 5.04 The company had average operating assets of $2,000,000 during the year. Required: 1. Compute the company’s return on investment (ROI) for the...
Problem 10-20 Return on Investment (ROI) Analysis [LO10-1] The contribution format income statement for Huerra Company...
Problem 10-20 Return on Investment (ROI) Analysis [LO10-1] The contribution format income statement for Huerra Company for last year is given below: Total Unit Sales $ 1,008,000 $ 50.40 Variable expenses 604,800 30.24 Contribution margin 403,200 20.16 Fixed expenses 319,200 15.96 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 $502,000 during the year. Required: 1. Compute the company’s return on investment (ROI) for the...
Problem 10-20 Return on Investment (ROI) Analysis (L010-1) The contribution format income statement for Huer...
Problem 10-20 Return on Investment (ROI) Analysis (L010-1) The contribution format income statement for Huerra Company for last year is given below. Sales Variable expenses Contribution margin Fixed expenses Net operating income Income taxes @ 4ex Net income Total Unit $1,004,000 $50.20 602,400 30.12 401,680 20.88 319,600 15.98 82,000 4.10 32,800 1.64 49,200 $ 2.46 The company had average operating assets of $499.000 during the year. Required: 1. Compute the company's return on investment (ROI) for the period using the...
Divisional Performance Analysis and Evaluation Divisional Performance Analysis and Evaluation The vice president of oper...
Divisional Performance Analysis and Evaluation
Divisional Performance Analysis and Evaluation The vice president of operations of Recycling Industries is evaluating the performance of two divisions organized as investment centers. Invested assets and condensed income statement data for the past year for each division are as follows: Business Division Consumer Division $42,800,000 Sales Cost of goods sold Operating expenses Invested assets 23,500,000 11,424,800 34,240,000 $56,000,000 30,500,000 14,300,000 70,000,000 Required: 1. Prepare condensed divisional income statements for the year ended December 31,...
Problem 10-20 Return on Investment (ROI) Analysis [L010-1 The contribution format income statement for Huerra Company...
Problem 10-20 Return on Investment (ROI) Analysis [L010-1 The contribution format income statement for Huerra Company for last year is given below 992,000 49.60 Variable expenses Contribution margin 595,200 396,800 84,000 50,400 19.84 312,800 15.64 4.20 Set operating ineome Income taxes e 40 Net isone 2.52 The company had average operating assets of $503,000 during the year Required 1. Compute the company's return on Investment (RO) for the perlod using the ROI formula stated in terms of margin and turnover...
Problem 11-15 Return on Investment (ROI) and Residual Income [LO11-1, LO11-2] Problem 11-15 Return on Investment...
Problem 11-15 Return on Investment (ROI) and Residual Income
[LO11-1, LO11-2]
Problem 11-15 Return on Investment (ROI) and Residual Income [LO11-1, LO11-2] Ending Balance Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance sheet Beginning Balance Assets Cash $ 125,000 Accounts receivable 339,000 Inventory 570,000 Plant and equipment, net 826,000 Investment in Buisson, S.A. 398,000 Land (undeveloped) 250,000 Total assets $ 2,508,000 Liabilities and stockholders' Equity Accounts payable $ 371,000 Long-term debt 976,000...
1. + -/3.33 points Question 1 (performance evaluation: RI, ROI) Generic Motors Corporation has two divisions,...
1. + -/3.33 points Question 1 (performance evaluation: RI, ROI) Generic Motors Corporation has two divisions, Kadillack and Chevrolay. Their performance for last year is as follows. Kadillack Chevrolay Investment (operating assets) $300 million $1,200 million Profit $57 million $174 million The required rate of return (cost of capital) for Generic Motors is 10% a year. Required: a) What is the return on investment (ROI) for each division? Kadillack ROI = % (enter say 9.5% as 9.5, not as 0.095...
10. Determine the April 2014 Return on Investment (ROI) for an investment center with the following information: Operating income for the month ended April 30, 2014 $80,000 65,000 After-tax operating income for April 30, 2014 Assets invested 25,000 Desired ROI 18% Actual ROI 20% (Round percentage answer to one decimal places.) ОА. 1.2 percentage ОВ. 2.6 percentage Oc. 3.2 percentage 75.5 percentage
Problem 10-20 Return on Investment (ROI) Analysis (L010-1) The contribution format income statement for Huerra Company for last year is given below. Sales Variable expenses Contribution margin Fixed expenses Net operating income Income taxes @ 4ex Net income Total Unit $1,004,000 $50.20 602,400 30.12 401,680 20.88 319,600 15.98 82,000 4.10 32,800 1.64 49,200 $ 2.46 The company had average operating assets of $499.000 during the year. Required: 1. Compute the company's return on investment (ROI) for the period using the...
Divisional Performance Analysis and Evaluation
Divisional Performance Analysis and Evaluation The vice president of operations of Recycling Industries is evaluating the performance of two divisions organized as investment centers. Invested assets and condensed income statement data for the past year for each division are as follows: Business Division Consumer Division $42,800,000 Sales Cost of goods sold Operating expenses Invested assets 23,500,000 11,424,800 34,240,000 $56,000,000 30,500,000 14,300,000 70,000,000 Required: 1. Prepare condensed divisional income statements for the year ended December 31,...
Problem 10-20 Return on Investment (ROI) Analysis [L010-1 The contribution format income statement for Huerra Company for last year is given below 992,000 49.60 Variable expenses Contribution margin 595,200 396,800 84,000 50,400 19.84 312,800 15.64 4.20 Set operating ineome Income taxes e 40 Net isone 2.52 The company had average operating assets of $503,000 during the year Required 1. Compute the company's return on Investment (RO) for the perlod using the ROI formula stated in terms of margin and turnover...
Problem 11-15 Return on Investment (ROI) and Residual Income
[LO11-1, LO11-2]
Problem 11-15 Return on Investment (ROI) and Residual Income [LO11-1, LO11-2] Ending Balance Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance sheet Beginning Balance Assets Cash $ 125,000 Accounts receivable 339,000 Inventory 570,000 Plant and equipment, net 826,000 Investment in Buisson, S.A. 398,000 Land (undeveloped) 250,000 Total assets $ 2,508,000 Liabilities and stockholders' Equity Accounts payable $ 371,000 Long-term debt 976,000...
1. + -/3.33 points Question 1 (performance evaluation: RI, ROI) Generic Motors Corporation has two divisions, Kadillack and Chevrolay. Their performance for last year is as follows. Kadillack Chevrolay Investment (operating assets) $300 million $1,200 million Profit $57 million $174 million The required rate of return (cost of capital) for Generic Motors is 10% a year. Required: a) What is the return on investment (ROI) for each division? Kadillack ROI = % (enter say 9.5% as 9.5, not as 0.095...
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