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Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below: Division...

Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below: Division Queensland New South Wales Sales $ 1,159,000 $ 1,617,000 Average operating assets $ 610,000 $ 490,000 Net operating income $ 127,490 $ 129,360 Property, plant, and equipment (net) $ 240,000 $ 190,000 Required: 1. Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margin and turnover. 2. Which divisional manager seems to be doing the better job?

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Format is not available, can be slightly different: Answer can be rounded per question requirement (e.g. 1 decimal place or 2) Format can be vertical or horizonal: Solution: New South Wales Queensland $11,59,000 $16,17,000 Particulars Sales Net operating income/loss Average Operating assets Margin (Net income/sales) Turnover (Sales/Assets) in Times ROI 1,27,4901,29,360 $ 6,10,000 4,90,000 11.00% 1.90 20.90% 8.00% 3.30 26.40% 1) (Margin x Turnover) 2) New South Wales Divisional manager is doing better job, because its ROI is greater than Queensland

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