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QUESTION 10 Which of the following statements is correct concerning return on investment calculations? Margin equals stockholders equity divided by sales Return on investment equals margin divided by turnover. Turnover equals return on investment divided by margin. Sales equals turnover divided by margin. QUESTION 11 Which of the following will NOT result in an increase in the residual income, assuming other factors remain constant? An increase in sales. An increase in the minimum required rate of return OA decrease in expenses A decrease in operating assets. QUESTION 12 An avoidable cost is a cost that can be eliminated (in whole or in part) as a result of choosing one alternative over another. O 1. True O 2. False QUESTION 13 Joint costs are irrelevant in the decision of whether to sell a joint product at the split-off point or process it further and then sell it. True OFalse

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All are individual questions. Although all have been answered:) Answers are highlighted in yellow: Solution: Answer: Explanation 10 Turnover equals return on investment divided by Margin. Because, return on Investment Margin x Turnover and Turnover ROI/Margin 11) An Increase in Minimum required rate of return. An increase in Minimum required rate of return will decrease the residual value. E.g. Old MRR 10000, new MRR 15000. 12) TRUE It is standardized and already defined. TRUE Because, there is no effect on joint cost on changing the decision Whether to sell at split of point or process further Therefore, it is irrelevant.

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