Consider the following data from two divisions of a company, P and Q: Divisional P Q...
Consider the following data from two divisions of a company, P and Q:
| Divisional | P | Q | ||||
| Sales | $ | 1,000,000 | $ | 1,700,000 | ||
| Operating Income | $ | 600,000 | $ | 680,000 | ||
| Investment | $ | 1,700,000 | $ | 2,040,000 | ||
If the minimum rate of return is 10%, what is Division P's residual income (RI)?
Multiple Choice
-
$430,000.
-
$770,000.
-
$830,000.
-
$940,000.
-
$1,640,000.
Homework Answers
Residual income=Net operating income-(Investment*Minimum required rate of return)
=600,000-(1,700,000*10%)
which is equal to
=$430,000
Add Answer to:
Consider the following data from two divisions of a company, P
and Q:
Divisional
P
Q...
Consider the following data from two divisions of a company. P and Q. Divisional Sales Operating...
Consider the following data from two divisions of a company. P and Q. Divisional Sales Operating Income Investment $1,500,000 $ 1,700,000 $ 600,000 $ 680,000 $1,950,000 $ 2,210,000 if the minimum rate of return is 8%, what is Division P's residual income (RI? Multiple Choice $444,000. C) $756.000 o $1,344,000 1452
Consider the following data from two divisions of a company, P and Q: Divisional Sales Operating...
Consider the following data from two divisions of a company, P and Q: Divisional Sales Operating Income Investment P $ 792,000 $ 526,500 $ 360,000 $ 351,000 $ 4,500,000 $3,900,000 If both divisions were presented with an opportunity to invest in a project that is estimated to achieve an ROI of 8%, what will the units likely decide?
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: Sales...
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: Sales Operating Income Investment in assets $1,318,000 $947,000 $5,411,000 193,000 109,500 334,700 476,700 435,500 4,500,200 The return on investment (ROI) for Division X is: Multiple Choice 0 74% 11.6% 0 25.1% 0
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X...
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X Y Z Sales $ 1,318,000 $ 947,000 $ 5,411,000 Operating Income 193,000 109,500 334,700 Investment in assets 476,700 435,500 4,500,200 The return on investment (ROI) for Division X is: Multiple Choice 7.4%. 11.6%. 25.1%. 31.3%. 40.5%.
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X...
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X Y Z Sales $ 1,494,000 $ 827,000 $ 4,912,000 Operating Income 180,200 49,500 247,600 Investment in assets 511,500 224,200 2,345,800 The return on sales (ROS) for Division Z is: Multiple Choice 5.0%. 10.6%. 6.0%. 12.1%. 22.1%.
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: Sales...
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: Sales Operating Income Investment in assets $1,468,000 $864,000 $4,601,000 219,400 181,400 233,700 560,500 747,300 2,307,300 The asset turnover (AT) for Division X is (rounded): Multiple Choice 0 0 0 0 0
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X...
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: X Y Z Sales $ 1,398,000 $ 840,000 $ 4,452,000 Operating Income 159,700 99,300 218,600 Investment in assets 336,700 393,800 2,742,700 The asset turnover (AT) for Division Y is calculated to be (rounded): Multiple Choice 2.28. 2.33. 2.13. 4.15. 2.92.
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,...
Consider the following data (in millions) from Trident Financial Inc., which has two main divisions, mortgage...
Consider the following data (in millions) from Trident Financial Inc., which has two main divisions, mortgage loans and consumer loans Average total assets Operating income Return on investment (ROI) Mortgage Loans $ 2,000 $ 400 208 Consumer Loans $ 20,000 $ 2,500 12.5% Required: 1. Based on ROI, which division is more successful? O Mortgage loans O Consumer loans 2. Trident uses residual income (RI) as a measure of the financial performance of its divisions. What is the RI for...
Consider the following data (in millions) from Trident Financial Inc., which has two main divisions, mortgage...
Consider the following data (in millions) from Trident Financial
Inc., which has two main divisions, mortgage loans and consumer
loans:
Mortgage Loans
Consumer Loans
Average total assets
$
1,100
$
21,250
Operating income
$
242
$
2,550
Return on investment (ROI)
22.00
%
12.00
%
Required:
1. Based on ROI, which division is more successful?
Mortgage loans
Consumer loans
2. Trident uses residual income (RI) as a measure of the
financial performance of its divisions. What is the RI for...
Consider the following data from two divisions of a company. P and Q. Divisional Sales Operating Income Investment $1,500,000 $ 1,700,000 $ 600,000 $ 680,000 $1,950,000 $ 2,210,000 if the minimum rate of return is 8%, what is Division P's residual income (RI? Multiple Choice $444,000. C) $756.000 o $1,344,000 1452
Consider the following data from two divisions of a company, P and Q: Divisional Sales Operating Income Investment P $ 792,000 $ 526,500 $ 360,000 $ 351,000 $ 4,500,000 $3,900,000 If both divisions were presented with an opportunity to invest in a project that is estimated to achieve an ROI of 8%, what will the units likely decide?
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: Sales Operating Income Investment in assets $1,318,000 $947,000 $5,411,000 193,000 109,500 334,700 476,700 435,500 4,500,200 The return on investment (ROI) for Division X is: Multiple Choice 0 74% 11.6% 0 25.1% 0
Consider the following data for three divisions of a company, X, Y, and Z: Divisional: Sales Operating Income Investment in assets $1,468,000 $864,000 $4,601,000 219,400 181,400 233,700 560,500 747,300 2,307,300 The asset turnover (AT) for Division X is (rounded): Multiple Choice 0 0 0 0 0
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,...
Consider the following data (in millions) from Trident Financial Inc., which has two main divisions, mortgage loans and consumer loans Average total assets Operating income Return on investment (ROI) Mortgage Loans $ 2,000 $ 400 208 Consumer Loans $ 20,000 $ 2,500 12.5% Required: 1. Based on ROI, which division is more successful? O Mortgage loans O Consumer loans 2. Trident uses residual income (RI) as a measure of the financial performance of its divisions. What is the RI for...
Consider the following data (in millions) from Trident Financial
Inc., which has two main divisions, mortgage loans and consumer
loans:
Mortgage Loans
Consumer Loans
Average total assets
$
1,100
$
21,250
Operating income
$
242
$
2,550
Return on investment (ROI)
22.00
%
12.00
%
Required:
1. Based on ROI, which division is more successful?
Mortgage loans
Consumer loans
2. Trident uses residual income (RI) as a measure of the
financial performance of its divisions. What is the RI for...
Most questions answered within 3 hours.
-
2) You are given the task of finding a representation for a
circle in a drawing...
asked 37 minutes ago -
STUDY QUESTION: Does use of diet drug fen-phen
(fenfluramine-phentermine) cause valvular heart disease?
HINT: Valvular heart...
asked 28 minutes ago -
1. An object weighing 40 N rests on a surface. The coefficient
of friction is 0.35....
asked 1 hour ago -
Investor company owns 35% of investee company voting stock and
accounts for the investment under the...
asked 2 hours ago -
The number of major faults on a randomly chosen 1 km stretch of
highway has a...
asked 3 hours ago -
Consider the competitive environment of Starbuck's, Progressive
Insurance, a manufacturing firm with low turnover, or a...
asked 4 hours ago -
3. Gains from trade
Consider two neighbouring island countries called Euphoria and
Contente. They each have...
asked 5 hours ago -
A business executive has the option to invest money in two
plans: Plan A guarantees that...
asked 8 hours ago -
Hello, can someone please help me answer this question?
How much heat is absorbed by a...
asked 8 hours ago -
. A marketing researcher conducted a survey of 25 shoppers
randomly selected at the local mall...
asked 8 hours ago -
Create an comprehensive response to the
following:
Antimicrobial agents work on a multitude of microbes (bacteria,...
asked 8 hours ago -
6.13 LAB: Step counter. Section 6.3.
A pedometer treats walking 2,000 steps as walking 1 mile....
asked 8 hours ago