Question

Liz Raiborn Inc. has the following financial results for the years 2019 through 2021 for its three regional divisions:

	2019			2020			2021
Revenue
Southwest	$	14,600		$	21,700		$	25,700
Midwest		6,400			6,700			6,900
Southeast		12,100			12,700			13,000
Total	$	33,100		$	41,100		$	45,600
Net Operating Income
Southwest	$	800		$	900		$	1,050
Midwest		950			1,300			1,250
Southeast		700			900			1,300
Total	$	2,450		$	3,100		$	3,600
Average Total Assets
Southwest	$	13,700		$	13,900		$	16,500
Midwest		4,400			3,900			3,900
Southeast		5,000			5,300			5,300
Total	$	23,100		$	23,100		$	25,700

Required:

Calculate return on sales (ROS), asset turnover (AT), and return on investment (ROI) for each division and also for the firm as a whole for each of the three years 2019, 2020, and 2021. (Note: Due to rounding your percentages, the totals for the firm might not be the actual total of the individual divisions.) (Round "Asset turnover (AT)" answers to 3 decimal places and other answers to 1 decimal place.)

                                                       2019      2020 2021

Return on Sales (ROS)                                                                               

Southwest                                               %                          %                            %

Midwest                                                   %                          %                            %

Southeast                                                %                          %                            %

Firm                                                         %                         %                             %

Asset turnover

Southwest

Midwest

Southeast

Firm

Return on Investment (ROI)

Southwest                                                %                           %                              %

Midwest                                                    %                           %                              %

Southeast                                                  %                           %                             %

Firm                                                          %                           %                              %

Answer 1

2020 2021 4.1% Particular 2019 Return on Sales (ROS) = (Net Operating Income/Revenue)* 100 Southwest 5.5% Midwest 14.8% Southeast 5.8% Firm 7.4% 4.1% 19.4% 7.1% 7.5% 18.1% 10.0% 7.9% Asset turnover = (Revenues/Average total assets) Southwest Midwest 1.066 1.561 1.558 1.769 1.455 1.718 2.420 2.396 2.453 Southeast Firm 1.433 1.779 1.774 6.4% Return on investment = (Net Operating income Average total assets)*100 Southwest 5.8% 6.5% Midwest 21.6% 33.3% Southeast 14.0% 17.0% Firm 10.6% 13.4% 32.1% 24.5% 14.0%